Correlation Between Mene and Movado
Can any of the company-specific risk be diversified away by investing in both Mene and Movado 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 Mene and Movado into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mene Inc and Movado Group, you can compare the effects of market volatilities on Mene and Movado 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 Mene with a short position of Movado. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mene and Movado.
Diversification Opportunities for Mene and Movado
Very good diversification
The 3 months correlation between Mene and Movado is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Mene Inc and Movado Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Movado Group and Mene 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 Mene Inc are associated (or correlated) with Movado. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Movado Group has no effect on the direction of Mene i.e., Mene and Movado go up and down completely randomly.
Pair Corralation between Mene and Movado
Assuming the 90 days horizon Mene Inc is expected to generate 3.74 times more return on investment than Movado. However, Mene is 3.74 times more volatile than Movado Group. It trades about 0.09 of its potential returns per unit of risk. Movado Group is currently generating about -0.01 per unit of risk. If you would invest 8.60 in Mene Inc on December 2, 2024 and sell it today you would earn a total of 1.40 from holding Mene Inc or generate 16.28% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Mene Inc vs. Movado Group
Performance |
Timeline |
Mene Inc |
Movado Group |
Mene and Movado Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mene and Movado
The main advantage of trading using opposite Mene and Movado positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mene position performs unexpectedly, Movado 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 Movado will offset losses from the drop in Movado's long position.Mene vs. Lanvin Group Holdings | Mene vs. MYT Netherlands Parent | Mene vs. Movado Group | Mene vs. Birks Group |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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