Correlation Between 90331HPL1 and 552848AG8
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By analyzing existing cross correlation between US BANK NATIONAL and MGIC INVT P, you can compare the effects of market volatilities on 90331HPL1 and 552848AG8 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 90331HPL1 with a short position of 552848AG8. Check out your portfolio center. Please also check ongoing floating volatility patterns of 90331HPL1 and 552848AG8.
Diversification Opportunities for 90331HPL1 and 552848AG8
Very weak diversification
The 3 months correlation between 90331HPL1 and 552848AG8 is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding US BANK NATIONAL and MGIC INVT P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MGIC INVT P and 90331HPL1 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 US BANK NATIONAL are associated (or correlated) with 552848AG8. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MGIC INVT P has no effect on the direction of 90331HPL1 i.e., 90331HPL1 and 552848AG8 go up and down completely randomly.
Pair Corralation between 90331HPL1 and 552848AG8
Assuming the 90 days trading horizon US BANK NATIONAL is expected to generate 164.09 times more return on investment than 552848AG8. However, 90331HPL1 is 164.09 times more volatile than MGIC INVT P. It trades about 0.08 of its potential returns per unit of risk. MGIC INVT P is currently generating about 0.01 per unit of risk. If you would invest 9,431 in US BANK NATIONAL on August 31, 2024 and sell it today you would earn a total of 116.00 from holding US BANK NATIONAL or generate 1.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 64.86% |
| Values | Daily Returns |
US BANK NATIONAL vs. MGIC INVT P
Performance |
| Timeline |
| US BANK NATIONAL |
| MGIC INVT P |
90331HPL1 and 552848AG8 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 90331HPL1 and 552848AG8
The main advantage of trading using opposite 90331HPL1 and 552848AG8 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 90331HPL1 position performs unexpectedly, 552848AG8 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 552848AG8 will offset losses from the drop in 552848AG8's long position.The idea behind US BANK NATIONAL and MGIC INVT P pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| 552848AG8 vs. Marfrig Global Foods | 552848AG8 vs. SunOpta | 552848AG8 vs. Westinghouse Air Brake | 552848AG8 vs. Where Food Comes |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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