Correlation Between Mapfre SA and BLUELINX HLDGS
Can any of the company-specific risk be diversified away by investing in both Mapfre SA and BLUELINX HLDGS 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 Mapfre SA and BLUELINX HLDGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mapfre SA and BLUELINX HLDGS DL 01, you can compare the effects of market volatilities on Mapfre SA and BLUELINX HLDGS 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 Mapfre SA with a short position of BLUELINX HLDGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mapfre SA and BLUELINX HLDGS.
Diversification Opportunities for Mapfre SA and BLUELINX HLDGS
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mapfre and BLUELINX is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Mapfre SA and BLUELINX HLDGS DL 01 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BLUELINX HLDGS DL and Mapfre SA 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 Mapfre SA are associated (or correlated) with BLUELINX HLDGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BLUELINX HLDGS DL has no effect on the direction of Mapfre SA i.e., Mapfre SA and BLUELINX HLDGS go up and down completely randomly.
Pair Corralation between Mapfre SA and BLUELINX HLDGS
Assuming the 90 days trading horizon Mapfre SA is expected to generate 0.57 times more return on investment than BLUELINX HLDGS. However, Mapfre SA is 1.74 times less risky than BLUELINX HLDGS. It trades about 0.1 of its potential returns per unit of risk. BLUELINX HLDGS DL 01 is currently generating about -0.03 per unit of risk. If you would invest 185.00 in Mapfre SA on December 5, 2024 and sell it today you would earn a total of 93.00 from holding Mapfre SA or generate 50.27% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Mapfre SA vs. BLUELINX HLDGS DL 01
Performance |
Timeline |
Mapfre SA |
BLUELINX HLDGS DL |
Mapfre SA and BLUELINX HLDGS Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mapfre SA and BLUELINX HLDGS
The main advantage of trading using opposite Mapfre SA and BLUELINX HLDGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mapfre SA position performs unexpectedly, BLUELINX HLDGS 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 BLUELINX HLDGS will offset losses from the drop in BLUELINX HLDGS's long position.Mapfre SA vs. APPLIED MATERIALS | Mapfre SA vs. Applied Materials | Mapfre SA vs. PENN NATL GAMING | Mapfre SA vs. CONTAGIOUS GAMING INC |
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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