Correlation Between Magna International and Horizon Global
Can any of the company-specific risk be diversified away by investing in both Magna International and Horizon Global 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 Magna International and Horizon Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magna International and Horizon Global Corp, you can compare the effects of market volatilities on Magna International and Horizon Global 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 Magna International with a short position of Horizon Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magna International and Horizon Global.
Diversification Opportunities for Magna International and Horizon Global
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Magna and Horizon is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Magna International and Horizon Global Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Horizon Global Corp and Magna International 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 Magna International are associated (or correlated) with Horizon Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Horizon Global Corp has no effect on the direction of Magna International i.e., Magna International and Horizon Global go up and down completely randomly.
Pair Corralation between Magna International and Horizon Global
If you would invest 176.00 in Horizon Global Corp on January 17, 2024 and sell it today you would earn a total of 0.00 from holding Horizon Global Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Magna International vs. Horizon Global Corp
Performance |
| Timeline |
| Magna International |
| Horizon Global Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Magna International and Horizon Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magna International and Horizon Global
The main advantage of trading using opposite Magna International and Horizon Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magna International position performs unexpectedly, Horizon Global 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 Horizon Global will offset losses from the drop in Horizon Global's long position.| Magna International vs. Mullen Automotive | Magna International vs. Canoo Inc | Magna International vs. Faraday Future Intelligent | Magna International vs. GreenPower Motor |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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