Correlation Between Manhattan Associates and Mastech Holdings
Can any of the company-specific risk be diversified away by investing in both Manhattan Associates and Mastech Holdings 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 Manhattan Associates and Mastech Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manhattan Associates and Mastech Holdings, you can compare the effects of market volatilities on Manhattan Associates and Mastech Holdings 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 Manhattan Associates with a short position of Mastech Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manhattan Associates and Mastech Holdings.
Diversification Opportunities for Manhattan Associates and Mastech Holdings
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Manhattan and Mastech is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Manhattan Associates and Mastech Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mastech Holdings and Manhattan Associates 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 Manhattan Associates are associated (or correlated) with Mastech Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mastech Holdings has no effect on the direction of Manhattan Associates i.e., Manhattan Associates and Mastech Holdings go up and down completely randomly.
Pair Corralation between Manhattan Associates and Mastech Holdings
Given the investment horizon of 90 days Manhattan Associates is expected to generate 0.58 times more return on investment than Mastech Holdings. However, Manhattan Associates is 1.72 times less risky than Mastech Holdings. It trades about -0.23 of its potential returns per unit of risk. Mastech Holdings is currently generating about -0.18 per unit of risk. If you would invest 20,028 in Manhattan Associates on December 5, 2024 and sell it today you would lose (2,887) from holding Manhattan Associates or give up 14.41% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Manhattan Associates vs. Mastech Holdings
Performance |
Timeline |
Manhattan Associates |
Mastech Holdings |
Manhattan Associates and Mastech Holdings Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Manhattan Associates and Mastech Holdings
The main advantage of trading using opposite Manhattan Associates and Mastech Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manhattan Associates position performs unexpectedly, Mastech Holdings 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 Mastech Holdings will offset losses from the drop in Mastech Holdings' long position.Manhattan Associates vs. Blackbaud | Manhattan Associates vs. Bentley Systems | Manhattan Associates vs. Paylocity Holdng | Manhattan Associates vs. ANSYS 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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