Correlation Between Magna International and SANOK RUBBER
Can any of the company-specific risk be diversified away by investing in both Magna International and SANOK RUBBER 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 Magna International and SANOK RUBBER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magna International and SANOK RUBBER ZY, you can compare the effects of market volatilities on Magna International and SANOK RUBBER 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 Magna International with a short position of SANOK RUBBER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magna International and SANOK RUBBER.
Diversification Opportunities for Magna International and SANOK RUBBER
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Magna and SANOK is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Magna International and SANOK RUBBER ZY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SANOK RUBBER ZY and Magna International 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 Magna International are associated (or correlated) with SANOK RUBBER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SANOK RUBBER ZY has no effect on the direction of Magna International i.e., Magna International and SANOK RUBBER go up and down completely randomly.
Pair Corralation between Magna International and SANOK RUBBER
Assuming the 90 days horizon Magna International is expected to generate 0.67 times more return on investment than SANOK RUBBER. However, Magna International is 1.49 times less risky than SANOK RUBBER. It trades about 0.21 of its potential returns per unit of risk. SANOK RUBBER ZY is currently generating about 0.1 per unit of risk. If you would invest 2,880 in Magna International on April 24, 2025 and sell it today you would earn a total of 783.00 from holding Magna International or generate 27.19% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Magna International vs. SANOK RUBBER ZY
Performance |
Timeline |
Magna International |
SANOK RUBBER ZY |
Magna International and SANOK RUBBER Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Magna International and SANOK RUBBER
The main advantage of trading using opposite Magna International and SANOK RUBBER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magna International position performs unexpectedly, SANOK RUBBER 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 SANOK RUBBER will offset losses from the drop in SANOK RUBBER's long position.Magna International vs. Salesforce | Magna International vs. PROSIEBENSAT1 MEDIADR4 | Magna International vs. BJs Restaurants | Magna International vs. Luckin Coffee |
SANOK RUBBER vs. ALTAIR RES INC | SANOK RUBBER vs. ScanSource | SANOK RUBBER vs. Ryanair Holdings plc | SANOK RUBBER vs. MAROC TELECOM |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |