Correlation Between Multi Ways and Fortress Transportation

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

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

Diversification Opportunities for Multi Ways and Fortress Transportation

-0.44

Correlation Coefficient

Multi Ways  Fortress Transportation

Very good diversification

The 3 months correlation between Multi and Fortress is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Multi Ways Holdings and Fortress Transportation and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortress Transportation and Multi Ways 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 Multi Ways Holdings are associated (or correlated) with Fortress Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortress Transportation has no effect on the direction of Multi Ways i.e., Multi Ways and Fortress Transportation go up and down completely randomly.

Pair Corralation between Multi Ways and Fortress Transportation

Considering the 90-day investment horizon Multi Ways Holdings is expected to under-perform the Fortress Transportation. In addition to that, Multi Ways is 10.39 times more volatile than Fortress Transportation and. It trades about -0.08 of its total potential returns per unit of risk. Fortress Transportation and is currently generating about 0.1 per unit of volatility. If you would invest  2,527  in Fortress Transportation and on September 3, 2024 and sell it today you would earn a total of  103.00  from holding Fortress Transportation and or generate 4.08% return on investment over 90 days.

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

Multi Ways Holdings  vs.  Fortress Transportation and

Multi Ways Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Multi Ways Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Fortress Transportation

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fortress Transportation and are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward indicators, Fortress Transportation is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Multi Ways and Fortress Transportation

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

The idea behind Multi Ways Holdings and Fortress Transportation and 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.