Correlation Between Marfrig Global and Motorola Solutions

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Marfrig Global and Motorola Solutions 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 Marfrig Global and Motorola Solutions into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marfrig Global Foods and Motorola Solutions, you can compare the effects of market volatilities on Marfrig Global and Motorola Solutions 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 Marfrig Global with a short position of Motorola Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marfrig Global and Motorola Solutions.

Diversification Opportunities for Marfrig Global and Motorola Solutions

MarfrigMotorolaDiversified AwayMarfrigMotorolaDiversified Away100%
0.7
  Correlation Coefficient

Poor diversification

The 3 months correlation between Marfrig and Motorola is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Marfrig Global Foods and Motorola Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Motorola Solutions and Marfrig Global 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 Marfrig Global Foods are associated (or correlated) with Motorola Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Motorola Solutions has no effect on the direction of Marfrig Global i.e., Marfrig Global and Motorola Solutions go up and down completely randomly.

Pair Corralation between Marfrig Global and Motorola Solutions

Assuming the 90 days trading horizon Marfrig Global Foods is expected to generate 1.71 times more return on investment than Motorola Solutions. However, Marfrig Global is 1.71 times more volatile than Motorola Solutions. It trades about 0.12 of its potential returns per unit of risk. Motorola Solutions is currently generating about 0.03 per unit of risk. If you would invest  1,345  in Marfrig Global Foods on October 31, 2024 and sell it today you would earn a total of  248.00  from holding Marfrig Global Foods or generate 18.44% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy98.28%
ValuesDaily Returns

Marfrig Global Foods  vs.  Motorola Solutions

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 010203040
JavaScript chart by amCharts 3.21.15MRFG3 M1SI34
       Timeline  
Marfrig Global Foods 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Marfrig Global Foods are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Marfrig Global unveiled solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan131415161718
Motorola Solutions 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Motorola Solutions are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Motorola Solutions is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan670680690700710720730740750

Marfrig Global and Motorola Solutions Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-8.36-6.26-4.16-2.060.032.184.436.698.9411.2 0.050.100.15
JavaScript chart by amCharts 3.21.15MRFG3 M1SI34
       Returns  

Pair Trading with Marfrig Global and Motorola Solutions

The main advantage of trading using opposite Marfrig Global and Motorola Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marfrig Global position performs unexpectedly, Motorola Solutions 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 Motorola Solutions will offset losses from the drop in Motorola Solutions' long position.
The idea behind Marfrig Global Foods and Motorola Solutions 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.
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.

Other Complementary Tools

Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
Sectors
List of equity sectors categorizing publicly traded companies based on their primary business activities
Equity Forecasting
Use basic forecasting models to generate price predictions and determine price momentum
Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance
Pair Correlation
Compare performance and examine fundamental relationship between any two equity instruments