Correlation Between Yara International and Mapletree Industrial
Can any of the company-specific risk be diversified away by investing in both Yara International and Mapletree Industrial 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 Yara International and Mapletree Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yara International ASA and Mapletree Industrial Trust, you can compare the effects of market volatilities on Yara International and Mapletree Industrial 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 Yara International with a short position of Mapletree Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yara International and Mapletree Industrial.
Diversification Opportunities for Yara International and Mapletree Industrial
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yara and Mapletree is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Yara International ASA and Mapletree Industrial Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mapletree Industrial and Yara International 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 Yara International ASA are associated (or correlated) with Mapletree Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mapletree Industrial has no effect on the direction of Yara International i.e., Yara International and Mapletree Industrial go up and down completely randomly.
Pair Corralation between Yara International and Mapletree Industrial
Assuming the 90 days horizon Yara International ASA is expected to under-perform the Mapletree Industrial. But the stock apears to be less risky and, when comparing its historical volatility, Yara International ASA is 1.05 times less risky than Mapletree Industrial. The stock trades about -0.01 of its potential returns per unit of risk. The Mapletree Industrial Trust is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 153.00 in Mapletree Industrial Trust on August 31, 2024 and sell it today you would earn a total of 7.00 from holding Mapletree Industrial Trust or generate 4.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 84.25% |
| Values | Daily Returns |
Yara International ASA vs. Mapletree Industrial Trust
Performance |
| Timeline |
| Yara International ASA |
| Mapletree Industrial |
Yara International and Mapletree Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yara International and Mapletree Industrial
The main advantage of trading using opposite Yara International and Mapletree Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yara International position performs unexpectedly, Mapletree Industrial 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 Mapletree Industrial will offset losses from the drop in Mapletree Industrial's long position.| Yara International vs. SBA Communications Corp | Yara International vs. Hollywood Bowl Group | Yara International vs. Live Nation Entertainment | Yara International vs. LG Display Co |
| Mapletree Industrial vs. Public Storage | Mapletree Industrial vs. Yara International ASA | Mapletree Industrial vs. Ascendas Real Estate | Mapletree Industrial vs. STAG Industrial |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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