Correlation Between MCB GROUP and ELITE MEAT

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

By analyzing existing cross correlation between MCB GROUP LTD and ELITE MEAT PROCESSORS, you can compare the effects of market volatilities on MCB GROUP and ELITE MEAT 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 MCB GROUP with a short position of ELITE MEAT. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCB GROUP and ELITE MEAT.

Diversification Opportunities for MCB GROUP and ELITE MEAT

0.0

Correlation Coefficient

MCB GROUP  ELITE MEAT

Pay attention - limited upside

The 3 months correlation between MCB and ELITE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding MCB GROUP LTD and ELITE MEAT PROCESSORS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ELITE MEAT PROCESSORS and MCB GROUP 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 MCB GROUP LTD are associated (or correlated) with ELITE MEAT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ELITE MEAT PROCESSORS has no effect on the direction of MCB GROUP i.e., MCB GROUP and ELITE MEAT go up and down completely randomly.

Pair Corralation between MCB GROUP and ELITE MEAT

If you would invest  1,015  in MCB GROUP LTD on September 26, 2024 and sell it today you would earn a total of  5.00  from holding MCB GROUP LTD or generate 0.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	12.6%
Values	Daily Returns

MCB GROUP LTD  vs.  ELITE MEAT PROCESSORS

MCB GROUP LTD

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MCB GROUP LTD has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Stock's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

ELITE MEAT PROCESSORS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ELITE MEAT PROCESSORS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, ELITE MEAT is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with MCB GROUP and ELITE MEAT

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

The idea behind MCB GROUP LTD and ELITE MEAT PROCESSORS 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.