Correlation Between Valic Company and Malaga Financial
Can any of the company-specific risk be diversified away by investing in both Valic Company and Malaga Financial 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 Valic Company and Malaga Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Valic Company I and Malaga Financial, you can compare the effects of market volatilities on Valic Company and Malaga Financial 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 Valic Company with a short position of Malaga Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valic Company and Malaga Financial.
Diversification Opportunities for Valic Company and Malaga Financial
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Valic and Malaga is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Valic Company I and Malaga Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Malaga Financial and Valic Company 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 Valic Company I are associated (or correlated) with Malaga Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Malaga Financial has no effect on the direction of Valic Company i.e., Valic Company and Malaga Financial go up and down completely randomly.
Pair Corralation between Valic Company and Malaga Financial
Assuming the 90 days horizon Valic Company I is expected to generate 0.36 times more return on investment than Malaga Financial. However, Valic Company I is 2.81 times less risky than Malaga Financial. It trades about 0.23 of its potential returns per unit of risk. Malaga Financial is currently generating about 0.01 per unit of risk. If you would invest 1,456 in Valic Company I on November 18, 2024 and sell it today you would earn a total of 32.00 from holding Valic Company I or generate 2.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valic Company I vs. Malaga Financial
Performance |
| Timeline |
| Valic Company I |
| Malaga Financial |
Valic Company and Malaga Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valic Company and Malaga Financial
The main advantage of trading using opposite Valic Company and Malaga Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valic Company position performs unexpectedly, Malaga Financial 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 Malaga Financial will offset losses from the drop in Malaga Financial's long position.| Valic Company vs. Mid Cap Index | Valic Company vs. Mid Cap Strategic | Valic Company vs. Valic Company I | Valic Company vs. Valic Company I |
| Malaga Financial vs. MF Bancorp | Malaga Financial vs. United Bancorporation of | Malaga Financial vs. Harbor Bankshares | Malaga Financial vs. BankFirst Capital |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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