Correlation Between XL Axiata and MTN Group
Can any of the company-specific risk be diversified away by investing in both XL Axiata and MTN Group 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 XL Axiata and MTN Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XL Axiata Tbk and MTN Group Ltd, you can compare the effects of market volatilities on XL Axiata and MTN Group 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 XL Axiata with a short position of MTN Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of XL Axiata and MTN Group.
Diversification Opportunities for XL Axiata and MTN Group
Pay attention - limited upside
The 3 months correlation between PTXKY and MTN is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding XL Axiata Tbk and MTN Group Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MTN Group and XL Axiata 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 XL Axiata Tbk are associated (or correlated) with MTN Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MTN Group has no effect on the direction of XL Axiata i.e., XL Axiata and MTN Group go up and down completely randomly.
Pair Corralation between XL Axiata and MTN Group
Assuming the 90 days horizon XL Axiata is expected to generate 1.3 times less return on investment than MTN Group. In addition to that, XL Axiata is 1.95 times more volatile than MTN Group Ltd. It trades about 0.02 of its total potential returns per unit of risk. MTN Group Ltd is currently generating about 0.05 per unit of volatility. If you would invest 482.00 in MTN Group Ltd on November 3, 2024 and sell it today you would earn a total of 135.00 from holding MTN Group Ltd or generate 28.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.19% |
| Values | Daily Returns |
XL Axiata Tbk vs. MTN Group Ltd
Performance |
| Timeline |
| XL Axiata Tbk |
| MTN Group |
XL Axiata and MTN Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XL Axiata and MTN Group
The main advantage of trading using opposite XL Axiata and MTN Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XL Axiata position performs unexpectedly, MTN Group 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 MTN Group will offset losses from the drop in MTN Group's long position.| XL Axiata vs. MTN Group Ltd | XL Axiata vs. Vodacom Group Ltd | XL Axiata vs. Telenor ASA ADR | XL Axiata vs. KT Corporation |
| MTN Group vs. XL Axiata Tbk | MTN Group vs. Telenor ASA ADR | MTN Group vs. KT Corporation | MTN Group vs. Vodacom Group Ltd |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |