Correlation Between Marfrig Global and Foxx Development
Can any of the company-specific risk be diversified away by investing in both Marfrig Global and Foxx Development 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 Marfrig Global and Foxx Development into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marfrig Global Foods and Foxx Development Holdings, you can compare the effects of market volatilities on Marfrig Global and Foxx Development 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 Marfrig Global with a short position of Foxx Development. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marfrig Global and Foxx Development.
Diversification Opportunities for Marfrig Global and Foxx Development
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Marfrig and Foxx is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Marfrig Global Foods and Foxx Development Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Foxx Development Holdings and Marfrig Global 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 Marfrig Global Foods are associated (or correlated) with Foxx Development. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Foxx Development Holdings has no effect on the direction of Marfrig Global i.e., Marfrig Global and Foxx Development go up and down completely randomly.
Pair Corralation between Marfrig Global and Foxx Development
Assuming the 90 days horizon Marfrig Global Foods is expected to generate 0.74 times more return on investment than Foxx Development. However, Marfrig Global Foods is 1.35 times less risky than Foxx Development. It trades about 0.05 of its potential returns per unit of risk. Foxx Development Holdings is currently generating about -0.01 per unit of risk. If you would invest 155.00 in Marfrig Global Foods on September 26, 2024 and sell it today you would earn a total of 108.00 from holding Marfrig Global Foods or generate 69.68% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Marfrig Global Foods vs. Foxx Development Holdings
Performance |
Timeline |
Marfrig Global Foods |
Foxx Development Holdings |
Marfrig Global and Foxx Development Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Marfrig Global and Foxx Development
The main advantage of trading using opposite Marfrig Global and Foxx Development positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marfrig Global position performs unexpectedly, Foxx Development 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 Foxx Development will offset losses from the drop in Foxx Development's long position.Marfrig Global vs. BRF SA ADR | Marfrig Global vs. Pilgrims Pride Corp | Marfrig Global vs. John B Sanfilippo | Marfrig Global vs. Seneca Foods Corp |
Foxx Development vs. Marfrig Global Foods | Foxx Development vs. NH Foods Ltd | Foxx Development vs. FitLife Brands, Common | Foxx Development vs. Sandstorm Gold Ltd |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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