Correlation Between McDonalds and Ftac Zeus

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

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

Diversification Opportunities for McDonalds and Ftac Zeus

-0.45

Correlation Coefficient

McDonalds  Ftac Zeus

Very good diversification

The 3 months correlation between McDonalds and Ftac is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding McDonalds and Ftac Zeus Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ftac Zeus Acquisition and McDonalds 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 McDonalds are associated (or correlated) with Ftac Zeus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ftac Zeus Acquisition has no effect on the direction of McDonalds i.e., McDonalds and Ftac Zeus go up and down completely randomly.

Pair Corralation between McDonalds and Ftac Zeus

If you would invest  29,028  in McDonalds on September 18, 2024 and sell it today you would earn a total of  743.00  from holding McDonalds or generate 2.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	1.59%
Values	Daily Returns

McDonalds  vs.  Ftac Zeus Acquisition

McDonalds

Risk-Adjusted Performance

3 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in McDonalds are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, McDonalds is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Ftac Zeus Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ftac Zeus Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Ftac Zeus is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with McDonalds and Ftac Zeus

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

The idea behind McDonalds and Ftac Zeus Acquisition 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..