Correlation Between Triad Group and Mulberry Group
Can any of the company-specific risk be diversified away by investing in both Triad Group and Mulberry 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 Triad Group and Mulberry Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Triad Group PLC and Mulberry Group PLC, you can compare the effects of market volatilities on Triad Group and Mulberry 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 Triad Group with a short position of Mulberry Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Triad Group and Mulberry Group.
Diversification Opportunities for Triad Group and Mulberry Group
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Triad and Mulberry is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Triad Group PLC and Mulberry Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mulberry Group PLC and Triad 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 Triad Group PLC are associated (or correlated) with Mulberry Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mulberry Group PLC has no effect on the direction of Triad Group i.e., Triad Group and Mulberry Group go up and down completely randomly.
Pair Corralation between Triad Group and Mulberry Group
Assuming the 90 days trading horizon Triad Group PLC is expected to generate 1.66 times more return on investment than Mulberry Group. However, Triad Group is 1.66 times more volatile than Mulberry Group PLC. It trades about 0.55 of its potential returns per unit of risk. Mulberry Group PLC is currently generating about -0.34 per unit of risk. If you would invest 28,000 in Triad Group PLC on October 23, 2024 and sell it today you would earn a total of 6,500 from holding Triad Group PLC or generate 23.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Triad Group PLC vs. Mulberry Group PLC
Performance |
| Timeline |
| Triad Group PLC |
| Mulberry Group PLC |
Triad Group and Mulberry Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Triad Group and Mulberry Group
The main advantage of trading using opposite Triad Group and Mulberry Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Triad Group position performs unexpectedly, Mulberry 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 Mulberry Group will offset losses from the drop in Mulberry Group's long position.| Triad Group vs. AMG Advanced Metallurgical | Triad Group vs. Cornish Metals | Triad Group vs. Golden Metal Resources | Triad Group vs. Seche Environnement SA |
| Mulberry Group vs. Ally Financial | Mulberry Group vs. Cairo Communication SpA | Mulberry Group vs. TBC Bank Group | Mulberry Group vs. UNIQA Insurance 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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