Correlation Between Resources Connection and Mistras
Can any of the company-specific risk be diversified away by investing in both Resources Connection and Mistras 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 Resources Connection and Mistras into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Resources Connection and Mistras Group, you can compare the effects of market volatilities on Resources Connection and Mistras 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 Resources Connection with a short position of Mistras. Check out your portfolio center. Please also check ongoing floating volatility patterns of Resources Connection and Mistras.
Diversification Opportunities for Resources Connection and Mistras
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Resources and Mistras is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Resources Connection and Mistras Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mistras Group and Resources Connection 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 Resources Connection are associated (or correlated) with Mistras. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mistras Group has no effect on the direction of Resources Connection i.e., Resources Connection and Mistras go up and down completely randomly.
Pair Corralation between Resources Connection and Mistras
Considering the 90-day investment horizon Resources Connection is expected to under-perform the Mistras. But the stock apears to be less risky and, when comparing its historical volatility, Resources Connection is 1.52 times less risky than Mistras. The stock trades about -0.07 of its potential returns per unit of risk. The Mistras Group is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 538.00 in Mistras Group on December 6, 2024 and sell it today you would earn a total of 493.00 from holding Mistras Group or generate 91.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Resources Connection vs. Mistras Group
Performance |
| Timeline |
| Resources Connection |
| Mistras Group |
Resources Connection and Mistras Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Resources Connection and Mistras
The main advantage of trading using opposite Resources Connection and Mistras positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Resources Connection position performs unexpectedly, Mistras 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 Mistras will offset losses from the drop in Mistras' long position.| Resources Connection vs. CRA International | Resources Connection vs. Huron Consulting Group | Resources Connection vs. Forrester Research | Resources Connection vs. Exponent |
| Mistras vs. Team Inc | Mistras vs. Thermon Group Holdings | Mistras vs. MRC Global | Mistras vs. Vishay Precision Group |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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