Correlation Between VGI Public and Mitsib Leasing
Can any of the company-specific risk be diversified away by investing in both VGI Public and Mitsib Leasing 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 VGI Public and Mitsib Leasing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VGI Public and Mitsib Leasing Public, you can compare the effects of market volatilities on VGI Public and Mitsib Leasing 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 VGI Public with a short position of Mitsib Leasing. Check out your portfolio center. Please also check ongoing floating volatility patterns of VGI Public and Mitsib Leasing.
Diversification Opportunities for VGI Public and Mitsib Leasing
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between VGI and Mitsib is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding VGI Public and Mitsib Leasing Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitsib Leasing Public and VGI Public 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 VGI Public are associated (or correlated) with Mitsib Leasing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitsib Leasing Public has no effect on the direction of VGI Public i.e., VGI Public and Mitsib Leasing go up and down completely randomly.
Pair Corralation between VGI Public and Mitsib Leasing
Assuming the 90 days trading horizon VGI Public is expected to generate 2.25 times more return on investment than Mitsib Leasing. However, VGI Public is 2.25 times more volatile than Mitsib Leasing Public. It trades about 0.0 of its potential returns per unit of risk. Mitsib Leasing Public is currently generating about -0.12 per unit of risk. If you would invest 320.00 in VGI Public on October 23, 2024 and sell it today you would lose (4.00) from holding VGI Public or give up 1.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VGI Public vs. Mitsib Leasing Public
Performance |
| Timeline |
| VGI Public |
| Mitsib Leasing Public |
VGI Public and Mitsib Leasing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VGI Public and Mitsib Leasing
The main advantage of trading using opposite VGI Public and Mitsib Leasing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VGI Public position performs unexpectedly, Mitsib Leasing 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 Mitsib Leasing will offset losses from the drop in Mitsib Leasing's long position.| VGI Public vs. BTS Group Holdings | VGI Public vs. WHA Public | VGI Public vs. Plan B Media | VGI Public vs. Gulf Energy Development |
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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