Correlation Between Marfrig Global and Teladoc Health
Can any of the company-specific risk be diversified away by investing in both Marfrig Global and Teladoc Health 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 Teladoc Health 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 Teladoc Health, you can compare the effects of market volatilities on Marfrig Global and Teladoc Health 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 Teladoc Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marfrig Global and Teladoc Health.
Diversification Opportunities for Marfrig Global and Teladoc Health
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Marfrig and Teladoc is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Marfrig Global Foods and Teladoc Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teladoc Health 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 Teladoc Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teladoc Health has no effect on the direction of Marfrig Global i.e., Marfrig Global and Teladoc Health go up and down completely randomly.
Pair Corralation between Marfrig Global and Teladoc Health
Assuming the 90 days trading horizon Marfrig Global Foods is expected to under-perform the Teladoc Health. But the stock apears to be less risky and, when comparing its historical volatility, Marfrig Global Foods is 1.22 times less risky than Teladoc Health. The stock trades about -0.26 of its potential returns per unit of risk. The Teladoc Health is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 196.00 in Teladoc Health on October 25, 2024 and sell it today you would lose (1.00) from holding Teladoc Health or give up 0.51% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Marfrig Global Foods vs. Teladoc Health
Performance |
Timeline |
Marfrig Global Foods |
Teladoc Health |
Marfrig Global and Teladoc Health Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Marfrig Global and Teladoc Health
The main advantage of trading using opposite Marfrig Global and Teladoc Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marfrig Global position performs unexpectedly, Teladoc Health 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 Teladoc Health will offset losses from the drop in Teladoc Health's long position.Marfrig Global vs. JBS SA | Marfrig Global vs. Minerva SA | Marfrig Global vs. BRF SA | Marfrig Global vs. Companhia Siderrgica Nacional |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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