Correlation Between Stonex and Mawson Infrastructure

Can any of the company-specific risk be diversified away by investing in both Stonex and Mawson Infrastructure 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 Stonex and Mawson Infrastructure into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Stonex Group and Mawson Infrastructure Group, you can compare the effects of market volatilities on Stonex and Mawson Infrastructure 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 Stonex with a short position of Mawson Infrastructure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stonex and Mawson Infrastructure.

Diversification Opportunities for Stonex and Mawson Infrastructure

-0.77

Correlation Coefficient

Stonex  Mawson Infrastructure

Pay attention - limited upside

The 3 months correlation between Stonex and Mawson is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Stonex Group and Mawson Infrastructure Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mawson Infrastructure and Stonex 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 Stonex Group are associated (or correlated) with Mawson Infrastructure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mawson Infrastructure has no effect on the direction of Stonex i.e., Stonex and Mawson Infrastructure go up and down completely randomly.

Pair Corralation between Stonex and Mawson Infrastructure

Given the investment horizon of 90 days Stonex Group is expected to generate 0.39 times more return on investment than Mawson Infrastructure. However, Stonex Group is 2.54 times less risky than Mawson Infrastructure. It trades about 0.11 of its potential returns per unit of risk. Mawson Infrastructure Group is currently generating about -0.12 per unit of risk. If you would invest  6,544  in Stonex Group on December 29, 2024 and sell it today you would earn a total of  1,068  from holding Stonex Group or generate 16.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Stonex Group  vs.  Mawson Infrastructure Group

Stonex Group

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Stonex Group are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain technical and fundamental indicators, Stonex showed solid returns over the last few months and may actually be approaching a breakup point.

Mawson Infrastructure

Risk-Adjusted Performance

Very Weak

Over the last 90 days Mawson Infrastructure Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Stonex and Mawson Infrastructure

The main advantage of trading using opposite Stonex and Mawson Infrastructure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stonex position performs unexpectedly, Mawson Infrastructure 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 Mawson Infrastructure will offset losses from the drop in Mawson Infrastructure's long position.

The idea behind Stonex Group and Mawson Infrastructure Group 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.

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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.