Correlation Between Pason Systems and Mullen
Can any of the company-specific risk be diversified away by investing in both Pason Systems and Mullen at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Pason Systems and Mullen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pason Systems and Mullen Group, you can compare the effects of market volatilities on Pason Systems and Mullen and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Pason Systems with a short position of Mullen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pason Systems and Mullen.
Diversification Opportunities for Pason Systems and Mullen
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pason and Mullen is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Pason Systems and Mullen Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mullen Group and Pason Systems is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Pason Systems are associated (or correlated) with Mullen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mullen Group has no effect on the direction of Pason Systems i.e., Pason Systems and Mullen go up and down completely randomly.
Pair Corralation between Pason Systems and Mullen
Assuming the 90 days trading horizon Pason Systems is expected to under-perform the Mullen. In addition to that, Pason Systems is 1.29 times more volatile than Mullen Group. It trades about -0.07 of its total potential returns per unit of risk. Mullen Group is currently generating about 0.03 per unit of volatility. If you would invest 1,433 in Mullen Group on November 9, 2024 and sell it today you would earn a total of 8.00 from holding Mullen Group or generate 0.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pason Systems vs. Mullen Group
Performance |
| Timeline |
| Pason Systems |
| Mullen Group |
Pason Systems and Mullen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pason Systems and Mullen
The main advantage of trading using opposite Pason Systems and Mullen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pason Systems position performs unexpectedly, Mullen can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Mullen will offset losses from the drop in Mullen's long position.| Pason Systems vs. Enerflex | Pason Systems vs. Mullen Group | Pason Systems vs. Secure Energy Services | Pason Systems vs. Ensign Energy Services |
| Mullen vs. Pason Systems | Mullen vs. Westshore Terminals Investment | Mullen vs. Superior Plus Corp | Mullen vs. Gibson Energy |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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