Correlation Between MFC Nichada and MFC Strategic
Can any of the company-specific risk be diversified away by investing in both MFC Nichada and MFC Strategic 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 MFC Nichada and MFC Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MFC Nichada Thani Property and MFC Strategic Storage, you can compare the effects of market volatilities on MFC Nichada and MFC Strategic 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 MFC Nichada with a short position of MFC Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFC Nichada and MFC Strategic.
Diversification Opportunities for MFC Nichada and MFC Strategic
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between MFC and MFC is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding MFC Nichada Thani Property and MFC Strategic Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MFC Strategic Storage and MFC Nichada 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 MFC Nichada Thani Property are associated (or correlated) with MFC Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MFC Strategic Storage has no effect on the direction of MFC Nichada i.e., MFC Nichada and MFC Strategic go up and down completely randomly.
Pair Corralation between MFC Nichada and MFC Strategic
Assuming the 90 days trading horizon MFC Nichada Thani Property is expected to generate 2.02 times more return on investment than MFC Strategic. However, MFC Nichada is 2.02 times more volatile than MFC Strategic Storage. It trades about 0.05 of its potential returns per unit of risk. MFC Strategic Storage is currently generating about 0.0 per unit of risk. If you would invest 189.00 in MFC Nichada Thani Property on April 24, 2025 and sell it today you would earn a total of 7.00 from holding MFC Nichada Thani Property or generate 3.7% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 98.28% |
Values | Daily Returns |
MFC Nichada Thani Property vs. MFC Strategic Storage
Performance |
Timeline |
MFC Nichada Thani |
MFC Strategic Storage |
MFC Nichada and MFC Strategic Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with MFC Nichada and MFC Strategic
The main advantage of trading using opposite MFC Nichada and MFC Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFC Nichada position performs unexpectedly, MFC Strategic 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 MFC Strategic will offset losses from the drop in MFC Strategic's long position.MFC Nichada vs. Equity Residential | MFC Nichada vs. Sun Communities | MFC Nichada vs. Major Cineplex Lifestyle | MFC Nichada vs. LH Shopping Centers |
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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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