Correlation Between Mughal Iron and Matco Foods
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By analyzing existing cross correlation between Mughal Iron Steel and Matco Foods, you can compare the effects of market volatilities on Mughal Iron and Matco Foods 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 Mughal Iron with a short position of Matco Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mughal Iron and Matco Foods.
Diversification Opportunities for Mughal Iron and Matco Foods
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Mughal and Matco is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Mughal Iron Steel and Matco Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matco Foods and Mughal Iron 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 Mughal Iron Steel are associated (or correlated) with Matco Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matco Foods has no effect on the direction of Mughal Iron i.e., Mughal Iron and Matco Foods go up and down completely randomly.
Pair Corralation between Mughal Iron and Matco Foods
Assuming the 90 days trading horizon Mughal Iron Steel is expected to under-perform the Matco Foods. But the stock apears to be less risky and, when comparing its historical volatility, Mughal Iron Steel is 1.36 times less risky than Matco Foods. The stock trades about -0.01 of its potential returns per unit of risk. The Matco Foods is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 3,716 in Matco Foods on October 10, 2024 and sell it today you would earn a total of 764.00 from holding Matco Foods or generate 20.56% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 95.24% |
Values | Daily Returns |
Mughal Iron Steel vs. Matco Foods
Performance |
Timeline |
Mughal Iron Steel |
Matco Foods |
Mughal Iron and Matco Foods Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mughal Iron and Matco Foods
The main advantage of trading using opposite Mughal Iron and Matco Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mughal Iron position performs unexpectedly, Matco Foods 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 Matco Foods will offset losses from the drop in Matco Foods' long position.Mughal Iron vs. Pakistan Reinsurance | Mughal Iron vs. Avanceon | Mughal Iron vs. Habib Insurance | Mughal Iron vs. IGI Life Insurance |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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