Correlation Between MTY Food and VIENNA INSURANCE

Can any of the company-specific risk be diversified away by investing in both MTY Food and VIENNA INSURANCE 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 MTY Food and VIENNA INSURANCE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MTY Food Group and VIENNA INSURANCE GR, you can compare the effects of market volatilities on MTY Food and VIENNA INSURANCE 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 MTY Food with a short position of VIENNA INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of MTY Food and VIENNA INSURANCE.

Diversification Opportunities for MTY Food and VIENNA INSURANCE

-0.64

Correlation Coefficient

MTY Food  VIENNA INSURANCE

Excellent diversification

The 3 months correlation between MTY and VIENNA is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding MTY Food Group and VIENNA INSURANCE GR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VIENNA INSURANCE and MTY Food 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 MTY Food Group are associated (or correlated) with VIENNA INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VIENNA INSURANCE has no effect on the direction of MTY Food i.e., MTY Food and VIENNA INSURANCE go up and down completely randomly.

Pair Corralation between MTY Food and VIENNA INSURANCE

Assuming the 90 days horizon MTY Food Group is expected to under-perform the VIENNA INSURANCE. In addition to that, MTY Food is 2.13 times more volatile than VIENNA INSURANCE GR. It trades about -0.09 of its total potential returns per unit of risk. VIENNA INSURANCE GR is currently generating about 0.4 per unit of volatility. If you would invest  3,015  in VIENNA INSURANCE GR on December 20, 2024 and sell it today you would earn a total of  950.00  from holding VIENNA INSURANCE GR or generate 31.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

MTY Food Group  vs.  VIENNA INSURANCE GR

MTY Food Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days MTY Food Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

VIENNA INSURANCE

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in VIENNA INSURANCE GR are ranked lower than 31 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, VIENNA INSURANCE unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with MTY Food and VIENNA INSURANCE

The main advantage of trading using opposite MTY Food and VIENNA INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MTY Food position performs unexpectedly, VIENNA INSURANCE 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 VIENNA INSURANCE will offset losses from the drop in VIENNA INSURANCE's long position.

The idea behind MTY Food Group and VIENNA INSURANCE GR 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.

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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.