Correlation Between Margo Caribe and ANTA Sports

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Can any of the company-specific risk be diversified away by investing in both Margo Caribe and ANTA Sports 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 Margo Caribe and ANTA Sports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Margo Caribe and ANTA Sports Products, you can compare the effects of market volatilities on Margo Caribe and ANTA Sports 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 Margo Caribe with a short position of ANTA Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Margo Caribe and ANTA Sports.

Diversification Opportunities for Margo Caribe and ANTA Sports

0.36
  Correlation Coefficient

Weak diversification

The 3 months correlation between Margo and ANTA is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Margo Caribe and ANTA Sports Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANTA Sports Products and Margo Caribe 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 Margo Caribe are associated (or correlated) with ANTA Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANTA Sports Products has no effect on the direction of Margo Caribe i.e., Margo Caribe and ANTA Sports go up and down completely randomly.

Pair Corralation between Margo Caribe and ANTA Sports

Given the investment horizon of 90 days Margo Caribe is expected to generate 24.59 times more return on investment than ANTA Sports. However, Margo Caribe is 24.59 times more volatile than ANTA Sports Products. It trades about 0.17 of its potential returns per unit of risk. ANTA Sports Products is currently generating about 0.09 per unit of risk. If you would invest  355.00  in Margo Caribe on September 26, 2024 and sell it today you would earn a total of  110.00  from holding Margo Caribe or generate 30.99% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Margo Caribe  vs.  ANTA Sports Products

 Performance 
       Timeline  
Margo Caribe 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Margo Caribe are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very weak technical and fundamental indicators, Margo Caribe displayed solid returns over the last few months and may actually be approaching a breakup point.
ANTA Sports Products 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Weak
Over the last 90 days ANTA Sports Products has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Margo Caribe and ANTA Sports Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Margo Caribe and ANTA Sports

The main advantage of trading using opposite Margo Caribe and ANTA Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Margo Caribe position performs unexpectedly, ANTA Sports 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 ANTA Sports will offset losses from the drop in ANTA Sports' long position.
The idea behind Margo Caribe and ANTA Sports Products 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.

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