Correlation Between Vapor and Mcig

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

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

Diversification Opportunities for Vapor and Mcig

0.0

Correlation Coefficient

Vapor  Mcig

Pay attention - limited upside

The 3 months correlation between Vapor and Mcig is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Vapor Group and Mcig Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mcig Inc and Vapor 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 Vapor Group are associated (or correlated) with Mcig. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mcig Inc has no effect on the direction of Vapor i.e., Vapor and Mcig go up and down completely randomly.

Pair Corralation between Vapor and Mcig

If you would invest  1.12  in Mcig Inc on October 10, 2024 and sell it today you would lose (0.22) from holding Mcig Inc or give up 19.64% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Vapor Group  vs.  Mcig Inc

Vapor Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Vapor Group has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Vapor is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Mcig Inc

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Mcig Inc are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, Mcig demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vapor and Mcig

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

The idea behind Vapor Group and Mcig Inc 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.