Correlation Between Monnari Trade and 4Mass SA
Can any of the company-specific risk be diversified away by investing in both Monnari Trade and 4Mass SA 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 Monnari Trade and 4Mass SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monnari Trade SA and 4Mass SA, you can compare the effects of market volatilities on Monnari Trade and 4Mass SA 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 Monnari Trade with a short position of 4Mass SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monnari Trade and 4Mass SA.
Diversification Opportunities for Monnari Trade and 4Mass SA
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Monnari and 4Mass is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Monnari Trade SA and 4Mass SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 4Mass SA and Monnari Trade 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 Monnari Trade SA are associated (or correlated) with 4Mass SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 4Mass SA has no effect on the direction of Monnari Trade i.e., Monnari Trade and 4Mass SA go up and down completely randomly.
Pair Corralation between Monnari Trade and 4Mass SA
Assuming the 90 days trading horizon Monnari Trade SA is expected to under-perform the 4Mass SA. In addition to that, Monnari Trade is 1.06 times more volatile than 4Mass SA. It trades about -0.25 of its total potential returns per unit of risk. 4Mass SA is currently generating about 0.1 per unit of volatility. If you would invest 656.00 in 4Mass SA on October 9, 2024 and sell it today you would earn a total of 17.00 from holding 4Mass SA or generate 2.59% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Monnari Trade SA vs. 4Mass SA
Performance |
Timeline |
Monnari Trade SA |
4Mass SA |
Monnari Trade and 4Mass SA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Monnari Trade and 4Mass SA
The main advantage of trading using opposite Monnari Trade and 4Mass SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monnari Trade position performs unexpectedly, 4Mass SA 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 4Mass SA will offset losses from the drop in 4Mass SA's long position.Monnari Trade vs. PZ Cormay SA | Monnari Trade vs. PMPG Polskie Media | Monnari Trade vs. Gaming Factory SA | Monnari Trade vs. Alior Bank SA |
4Mass SA vs. Asseco South Eastern | 4Mass SA vs. Vercom SA | 4Mass SA vs. CFI Holding SA | 4Mass SA vs. Gobarto SA |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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