Correlation Between Maytronics and Rimoni

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

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

Diversification Opportunities for Maytronics and Rimoni

-0.27

Correlation Coefficient

Maytronics  Rimoni

Very good diversification

The 3 months correlation between Maytronics and Rimoni is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Maytronics and Rimoni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rimoni and Maytronics 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 Maytronics are associated (or correlated) with Rimoni. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rimoni has no effect on the direction of Maytronics i.e., Maytronics and Rimoni go up and down completely randomly.

Pair Corralation between Maytronics and Rimoni

Assuming the 90 days trading horizon Maytronics is expected to under-perform the Rimoni. In addition to that, Maytronics is 1.47 times more volatile than Rimoni. It trades about -0.07 of its total potential returns per unit of risk. Rimoni is currently generating about -0.01 per unit of volatility. If you would invest  622,176  in Rimoni on September 24, 2024 and sell it today you would lose (113,176) from holding Rimoni or give up 18.19% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Maytronics  vs.  Rimoni

Maytronics

Risk-Adjusted Performance

1 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Maytronics are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Maytronics is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Rimoni

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Rimoni are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Rimoni sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Maytronics and Rimoni

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

The idea behind Maytronics and Rimoni 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.

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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.