Correlation Between Stag Industrial and MOLSON RS
Can any of the company-specific risk be diversified away by investing in both Stag Industrial and MOLSON RS 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 Stag Industrial and MOLSON RS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stag Industrial and MOLSON RS BEVERAGE, you can compare the effects of market volatilities on Stag Industrial and MOLSON RS 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 Stag Industrial with a short position of MOLSON RS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stag Industrial and MOLSON RS.
Diversification Opportunities for Stag Industrial and MOLSON RS
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Stag and MOLSON is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Stag Industrial and MOLSON RS BEVERAGE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MOLSON RS BEVERAGE and Stag Industrial 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 Stag Industrial are associated (or correlated) with MOLSON RS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MOLSON RS BEVERAGE has no effect on the direction of Stag Industrial i.e., Stag Industrial and MOLSON RS go up and down completely randomly.
Pair Corralation between Stag Industrial and MOLSON RS
Assuming the 90 days trading horizon Stag Industrial is expected to generate 0.73 times more return on investment than MOLSON RS. However, Stag Industrial is 1.37 times less risky than MOLSON RS. It trades about -0.15 of its potential returns per unit of risk. MOLSON RS BEVERAGE is currently generating about -0.13 per unit of risk. If you would invest 3,502 in Stag Industrial on October 26, 2024 and sell it today you would lose (231.00) from holding Stag Industrial or give up 6.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stag Industrial vs. MOLSON RS BEVERAGE
Performance |
| Timeline |
| Stag Industrial |
| MOLSON RS BEVERAGE |
Stag Industrial and MOLSON RS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stag Industrial and MOLSON RS
The main advantage of trading using opposite Stag Industrial and MOLSON RS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stag Industrial position performs unexpectedly, MOLSON RS 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 MOLSON RS will offset losses from the drop in MOLSON RS's long position.| Stag Industrial vs. Apple Inc | Stag Industrial vs. Apple Inc | Stag Industrial vs. Apple Inc | Stag Industrial vs. Apple Inc |
| MOLSON RS vs. Stag Industrial | MOLSON RS vs. Perseus Mining Limited | MOLSON RS vs. Forsys Metals Corp | MOLSON RS vs. Zijin Mining 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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