Correlation Between Avrot Industries and MetLife
Can any of the company-specific risk be diversified away by investing in both Avrot Industries and MetLife 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 Avrot Industries and MetLife into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avrot Industries and MetLife, you can compare the effects of market volatilities on Avrot Industries and MetLife 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 Avrot Industries with a short position of MetLife. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avrot Industries and MetLife.
Diversification Opportunities for Avrot Industries and MetLife
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Avrot and MetLife is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Avrot Industries and MetLife in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MetLife and Avrot Industries 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 Avrot Industries are associated (or correlated) with MetLife. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MetLife has no effect on the direction of Avrot Industries i.e., Avrot Industries and MetLife go up and down completely randomly.
Pair Corralation between Avrot Industries and MetLife
Assuming the 90 days trading horizon Avrot Industries is expected to generate 1.36 times less return on investment than MetLife. In addition to that, Avrot Industries is 4.54 times more volatile than MetLife. It trades about 0.02 of its total potential returns per unit of risk. MetLife is currently generating about 0.15 per unit of volatility. If you would invest 5,753 in MetLife on January 20, 2024 and sell it today you would earn a total of 1,242 from holding MetLife or generate 21.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 82.93% |
| Values | Daily Returns |
Avrot Industries vs. MetLife
Performance |
| Timeline |
| Avrot Industries |
| MetLife |
Avrot Industries and MetLife Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avrot Industries and MetLife
The main advantage of trading using opposite Avrot Industries and MetLife positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avrot Industries position performs unexpectedly, MetLife 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 MetLife will offset losses from the drop in MetLife's long position.| Avrot Industries vs. EN Shoham Business | Avrot Industries vs. Accel Solutions Group | Avrot Industries vs. Mivtach Shamir | Avrot Industries vs. Rani Zim Shopping |
| MetLife vs. Lincoln National | MetLife vs. Aflac Incorporated | MetLife vs. Unum Group | MetLife vs. Manulife Financial Corp |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| AI Investment Finder Use AI to screen and filter profitable investment opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |