Correlation Between ANT and MBI Administradora

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

By analyzing existing cross correlation between ANT and MBI Administradora General, you can compare the effects of market volatilities on ANT and MBI Administradora 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 ANT with a short position of MBI Administradora. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANT and MBI Administradora.

Diversification Opportunities for ANT and MBI Administradora

-0.22

Correlation Coefficient

ANT  MBI Administradora

Very good diversification

The 3 months correlation between ANT and MBI is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding ANT and MBI Administradora General in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MBI Administradora and ANT 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 ANT are associated (or correlated) with MBI Administradora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MBI Administradora has no effect on the direction of ANT i.e., ANT and MBI Administradora go up and down completely randomly.

Pair Corralation between ANT and MBI Administradora

Assuming the 90 days trading horizon ANT is expected to generate 43.85 times more return on investment than MBI Administradora. However, ANT is 43.85 times more volatile than MBI Administradora General. It trades about 0.1 of its potential returns per unit of risk. MBI Administradora General is currently generating about 0.03 per unit of risk. If you would invest  295.00  in ANT on October 10, 2024 and sell it today you would lose (148.00) from holding ANT or give up 50.17% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	60.99%
Values	Daily Returns

ANT  vs.  MBI Administradora General

ANT

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in ANT are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, ANT exhibited solid returns over the last few months and may actually be approaching a breakup point.

MBI Administradora

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in MBI Administradora General are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. Even with relatively invariable basic indicators, MBI Administradora is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with ANT and MBI Administradora

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

The idea behind ANT and MBI Administradora General 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.

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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.