Correlation Between MOL Nyrt and ANY Security

Can any of the company-specific risk be diversified away by investing in both MOL Nyrt and ANY Security 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 MOL Nyrt and ANY Security into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MOL Nyrt and ANY Security Printing, you can compare the effects of market volatilities on MOL Nyrt and ANY Security 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 MOL Nyrt with a short position of ANY Security. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOL Nyrt and ANY Security.

Diversification Opportunities for MOL Nyrt and ANY Security

0.35

Correlation Coefficient

MOL Nyrt  ANY Security

Weak diversification

The 3 months correlation between MOL and ANY is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding MOL Nyrt and ANY Security Printing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANY Security Printing and MOL Nyrt 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 MOL Nyrt are associated (or correlated) with ANY Security. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANY Security Printing has no effect on the direction of MOL Nyrt i.e., MOL Nyrt and ANY Security go up and down completely randomly.

Pair Corralation between MOL Nyrt and ANY Security

Assuming the 90 days trading horizon MOL Nyrt is expected to generate 1.32 times less return on investment than ANY Security. But when comparing it to its historical volatility, MOL Nyrt is 1.53 times less risky than ANY Security. It trades about 0.07 of its potential returns per unit of risk. ANY Security Printing is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  416,000  in ANY Security Printing on September 15, 2024 and sell it today you would earn a total of  7,000  from holding ANY Security Printing or generate 1.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

MOL Nyrt  vs.  ANY Security Printing

MOL Nyrt

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in MOL Nyrt are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, MOL Nyrt is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

ANY Security Printing

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with MOL Nyrt and ANY Security

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

The idea behind MOL Nyrt and ANY Security Printing 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..