Correlation Between RCS MediaGroup and Marfrig Global
Can any of the company-specific risk be diversified away by investing in both RCS MediaGroup and Marfrig Global 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 RCS MediaGroup and Marfrig Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RCS MediaGroup SpA and Marfrig Global Foods, you can compare the effects of market volatilities on RCS MediaGroup and Marfrig Global 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 RCS MediaGroup with a short position of Marfrig Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of RCS MediaGroup and Marfrig Global.
Diversification Opportunities for RCS MediaGroup and Marfrig Global
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between RCS and Marfrig is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding RCS MediaGroup SpA and Marfrig Global Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marfrig Global Foods and RCS MediaGroup 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 RCS MediaGroup SpA are associated (or correlated) with Marfrig Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marfrig Global Foods has no effect on the direction of RCS MediaGroup i.e., RCS MediaGroup and Marfrig Global go up and down completely randomly.
Pair Corralation between RCS MediaGroup and Marfrig Global
Assuming the 90 days horizon RCS MediaGroup is expected to generate 3.38 times less return on investment than Marfrig Global. But when comparing it to its historical volatility, RCS MediaGroup SpA is 2.01 times less risky than Marfrig Global. It trades about 0.22 of its potential returns per unit of risk. Marfrig Global Foods is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 263.00 in Marfrig Global Foods on September 12, 2024 and sell it today you would earn a total of 64.00 from holding Marfrig Global Foods or generate 24.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
RCS MediaGroup SpA vs. Marfrig Global Foods
Performance |
| Timeline |
| RCS MediaGroup SpA |
| Marfrig Global Foods |
RCS MediaGroup and Marfrig Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RCS MediaGroup and Marfrig Global
The main advantage of trading using opposite RCS MediaGroup and Marfrig Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RCS MediaGroup position performs unexpectedly, Marfrig Global 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 Marfrig Global will offset losses from the drop in Marfrig Global's long position.| RCS MediaGroup vs. Legible | RCS MediaGroup vs. Sylvania Platinum Limited | RCS MediaGroup vs. Thunderbird Entertainment Group | RCS MediaGroup vs. PAX Global Technology |
| Marfrig Global vs. BRF SA ADR | Marfrig Global vs. Pilgrims Pride Corp | Marfrig Global vs. John B Sanfilippo | Marfrig Global vs. Seneca Foods Corp |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |