Correlation Between Isetan Mitsukoshi and Marks
Can any of the company-specific risk be diversified away by investing in both Isetan Mitsukoshi and Marks 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 Isetan Mitsukoshi and Marks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Isetan Mitsukoshi Holdings and Marks and Spencer, you can compare the effects of market volatilities on Isetan Mitsukoshi and Marks 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 Isetan Mitsukoshi with a short position of Marks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Isetan Mitsukoshi and Marks.
Diversification Opportunities for Isetan Mitsukoshi and Marks
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Isetan and Marks is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Isetan Mitsukoshi Holdings and Marks and Spencer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marks and Spencer and Isetan Mitsukoshi 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 Isetan Mitsukoshi Holdings are associated (or correlated) with Marks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marks and Spencer has no effect on the direction of Isetan Mitsukoshi i.e., Isetan Mitsukoshi and Marks go up and down completely randomly.
Pair Corralation between Isetan Mitsukoshi and Marks
Assuming the 90 days horizon Isetan Mitsukoshi is expected to generate 2.44 times less return on investment than Marks. In addition to that, Isetan Mitsukoshi is 1.05 times more volatile than Marks and Spencer. It trades about 0.04 of its total potential returns per unit of risk. Marks and Spencer is currently generating about 0.11 per unit of volatility. If you would invest 133.00 in Marks and Spencer on September 23, 2024 and sell it today you would earn a total of 327.00 from holding Marks and Spencer or generate 245.86% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Isetan Mitsukoshi Holdings vs. Marks and Spencer
Performance |
Timeline |
Isetan Mitsukoshi |
Marks and Spencer |
Isetan Mitsukoshi and Marks Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Isetan Mitsukoshi and Marks
The main advantage of trading using opposite Isetan Mitsukoshi and Marks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Isetan Mitsukoshi position performs unexpectedly, Marks 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 Marks will offset losses from the drop in Marks' long position.Isetan Mitsukoshi vs. Aeon Co | Isetan Mitsukoshi vs. SHOPRITE HDGS ADR | Isetan Mitsukoshi vs. Shoprite Holdings Limited | Isetan Mitsukoshi vs. Dillards |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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