Correlation Between Strix Group and Murata Manufacturing
Can any of the company-specific risk be diversified away by investing in both Strix Group and Murata Manufacturing 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 Strix Group and Murata Manufacturing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Strix Group Plc and Murata Manufacturing Co, you can compare the effects of market volatilities on Strix Group and Murata Manufacturing 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 Strix Group with a short position of Murata Manufacturing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Strix Group and Murata Manufacturing.
Diversification Opportunities for Strix Group and Murata Manufacturing
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Strix and Murata is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Strix Group Plc and Murata Manufacturing Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Murata Manufacturing and Strix Group 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 Strix Group Plc are associated (or correlated) with Murata Manufacturing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Murata Manufacturing has no effect on the direction of Strix Group i.e., Strix Group and Murata Manufacturing go up and down completely randomly.
Pair Corralation between Strix Group and Murata Manufacturing
Assuming the 90 days horizon Strix Group Plc is expected to under-perform the Murata Manufacturing. In addition to that, Strix Group is 1.72 times more volatile than Murata Manufacturing Co. It trades about -0.03 of its total potential returns per unit of risk. Murata Manufacturing Co is currently generating about -0.01 per unit of volatility. If you would invest 1,844 in Murata Manufacturing Co on August 31, 2024 and sell it today you would lose (303.00) from holding Murata Manufacturing Co or give up 16.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.74% |
| Values | Daily Returns |
Strix Group Plc vs. Murata Manufacturing Co
Performance |
| Timeline |
| Strix Group Plc |
| Murata Manufacturing |
Strix Group and Murata Manufacturing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Strix Group and Murata Manufacturing
The main advantage of trading using opposite Strix Group and Murata Manufacturing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Strix Group position performs unexpectedly, Murata Manufacturing 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 Murata Manufacturing will offset losses from the drop in Murata Manufacturing's long position.| Strix Group vs. Murata Manufacturing Co | Strix Group vs. Corning Incorporated | Strix Group vs. TDK Corporation |
| Murata Manufacturing vs. New Residential Investment | Murata Manufacturing vs. MeVis Medical Solutions | Murata Manufacturing vs. AVITA Medical | Murata Manufacturing vs. EAT WELL INVESTMENT |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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