Correlation Between MBK Public and B 52

Can any of the company-specific risk be diversified away by investing in both MBK Public and B 52 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 MBK Public and B 52 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MBK Public and B 52 Capital Public, you can compare the effects of market volatilities on MBK Public and B 52 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 MBK Public with a short position of B 52. Check out your portfolio center. Please also check ongoing floating volatility patterns of MBK Public and B 52.

Diversification Opportunities for MBK Public and B 52

-0.33

Correlation Coefficient

MBK Public  B 52

Very good diversification

The 3 months correlation between MBK and B52 is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding MBK Public and B 52 Capital Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on B 52 Capital and MBK Public 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 MBK Public are associated (or correlated) with B 52. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of B 52 Capital has no effect on the direction of MBK Public i.e., MBK Public and B 52 go up and down completely randomly.

Pair Corralation between MBK Public and B 52

Assuming the 90 days trading horizon MBK Public is expected to generate 0.29 times more return on investment than B 52. However, MBK Public is 3.47 times less risky than B 52. It trades about 0.03 of its potential returns per unit of risk. B 52 Capital Public is currently generating about -0.02 per unit of risk. If you would invest  1,626  in MBK Public on September 25, 2024 and sell it today you would earn a total of  324.00  from holding MBK Public or generate 19.93% return on investment over 90 days.

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

MBK Public  vs.  B 52 Capital Public

MBK Public

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in MBK Public are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, MBK Public may actually be approaching a critical reversion point that can send shares even higher in January 2025.

B 52 Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days B 52 Capital Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with MBK Public and B 52

The main advantage of trading using opposite MBK Public and B 52 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MBK Public position performs unexpectedly, B 52 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 B 52 will offset losses from the drop in B 52's long position.

The idea behind MBK Public and B 52 Capital Public 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.