Correlation Between NSANY and Mitsubishi UFJ

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

By analyzing existing cross correlation between NSANY 4345 17 SEP 27 and Mitsubishi UFJ Lease, you can compare the effects of market volatilities on NSANY and Mitsubishi UFJ 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 NSANY with a short position of Mitsubishi UFJ. Check out your portfolio center. Please also check ongoing floating volatility patterns of NSANY and Mitsubishi UFJ.

Diversification Opportunities for NSANY and Mitsubishi UFJ

0.28

Correlation Coefficient

NSANY  Mitsubishi UFJ

Modest diversification

The 3 months correlation between NSANY and Mitsubishi is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding NSANY 4345 17 SEP 27 and Mitsubishi UFJ Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitsubishi UFJ Lease and NSANY 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 NSANY 4345 17 SEP 27 are associated (or correlated) with Mitsubishi UFJ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitsubishi UFJ Lease has no effect on the direction of NSANY i.e., NSANY and Mitsubishi UFJ go up and down completely randomly.

Pair Corralation between NSANY and Mitsubishi UFJ

Assuming the 90 days trading horizon NSANY 4345 17 SEP 27 is expected to under-perform the Mitsubishi UFJ. But the bond apears to be less risky and, when comparing its historical volatility, NSANY 4345 17 SEP 27 is 7.17 times less risky than Mitsubishi UFJ. The bond trades about -0.06 of its potential returns per unit of risk. The Mitsubishi UFJ Lease is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  1,323  in Mitsubishi UFJ Lease on December 24, 2024 and sell it today you would earn a total of  133.00  from holding Mitsubishi UFJ Lease or generate 10.05% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.08%
Values	Daily Returns

NSANY 4345 17 SEP 27  vs.  Mitsubishi UFJ Lease

NSANY 4345 17

Risk-Adjusted Performance

Very Weak

Over the last 90 days NSANY 4345 17 SEP 27 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, NSANY is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Mitsubishi UFJ Lease

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Mitsubishi UFJ Lease are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile technical and fundamental indicators, Mitsubishi UFJ showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with NSANY and Mitsubishi UFJ

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

The idea behind NSANY 4345 17 SEP 27 and Mitsubishi UFJ Lease 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.