Methode Electronics Stock Volatility

MEI Stock  USD 11.78  0.57  5.08%   
Methode Electronics has Sharpe Ratio of -0.2, which conveys that the firm had a -0.2% return per unit of risk over the last 3 months. Methode Electronics exposes twenty-three different technical indicators, which can help you to evaluate volatility embedded in its price movement. Please verify Methode Electronics' Risk Adjusted Performance of (0.09), standard deviation of 4.52, and Mean Deviation of 2.39 to check out the risk estimate we provide. Key indicators related to Methode Electronics' volatility include:
30 Days Market Risk
Chance Of Distress
30 Days Economic Sensitivity
Methode Electronics Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Methode daily returns, and it is calculated using variance and standard deviation. We also use Methode's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Methode Electronics volatility.
  
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Methode Electronics can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Methode Electronics at lower prices. For example, an investor can purchase Methode stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Methode Electronics' stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.

Moving together with Methode Stock

  0.72KN Knowles Cor Financial Report 25th of April 2024 PairCorr
  0.74UI Ubiquiti Networks Financial Report 3rd of May 2024 PairCorr
  0.7MITQ Moving IMage TechnologiesPairCorr

Moving against Methode Stock

  0.83NTAP NetApp Inc Financial Report 29th of May 2024 PairCorr
  0.69MINM Minim Inc Report 3rd of April 2024 PairCorr
  0.62CDW CDW Corp Financial Report 1st of May 2024 PairCorr
  0.57GLW Corning Incorporated Financial Report 23rd of April 2024 PairCorr
  0.55HPQ HP Inc Financial Report 4th of June 2024 PairCorr
  0.52NNDM Nano Dimension Report 4th of April 2024 PairCorr
  0.52FLEX Flex Financial Report 8th of May 2024 PairCorr
  0.41NTGR NETGEAR Financial Report 24th of April 2024 PairCorr

Methode Electronics Market Sensitivity And Downside Risk

Methode Electronics' beta coefficient measures the volatility of Methode stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Methode stock's returns against your selected market. In other words, Methode Electronics's beta of 1.85 provides an investor with an approximation of how much risk Methode Electronics stock can potentially add to one of your existing portfolios. Methode Electronics exhibits very low volatility with skewness of -4.76 and kurtosis of 31.25. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Methode Electronics' stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Methode Electronics' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Methode Electronics Demand Trend
Check current 90 days Methode Electronics correlation with market (NYSE Composite)

Methode Beta

    
  1.85  
Methode standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

    
  4.67  
It is essential to understand the difference between upside risk (as represented by Methode Electronics's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Methode Electronics' daily returns or price. Since the actual investment returns on holding a position in methode stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Methode Electronics.

Using Methode Put Option to Manage Risk

Put options written on Methode Electronics grant holders of the option the right to sell a specified amount of Methode Electronics at a specified price within a specified time frame. The put buyer has a limited loss and, while not fully unlimited gains, as the price of Methode Stock cannot fall below zero, the put buyer does gain as the price drops. So, one way investors can hedge Methode Electronics' position is by buying a put option against it. The put option used this way is usually referred to as insurance. If an undesired outcome occurs and loss on holding Methode Electronics will be realized, the loss incurred will be offset by the profits made with the option trade.

Methode Electronics' PUT expiring on 2024-04-19

   Profit   
       Methode Electronics Price At Expiration  

Current Methode Electronics Insurance Chain

DeltaGammaOpen IntExpirationCurrent SpreadLast Price
Put
2024-04-19 PUT at $25.0-0.82730.0359132024-04-1912.9 - 14.58.88View
Put
2024-04-19 PUT at $22.5-0.91870.03151362024-04-1910.5 - 11.29.9View
Put
2024-04-19 PUT at $20.0-0.82820.04791362024-04-197.1 - 8.66.75View
Put
2024-04-19 PUT at $17.5-0.83780.0609302024-04-195.5 - 6.36.0View
Put
2024-04-19 PUT at $15.0-0.88440.0883302024-04-192.95 - 3.72.95View
Put
2024-04-19 PUT at $12.5-0.64970.24091802024-04-190.9 - 1.21.2View
Put
2024-04-19 PUT at $10.0-0.11330.1127422024-04-190.0 - 0.150.1View
View All Methode Electronics Options

Methode Electronics Stock Volatility Analysis

Volatility refers to the frequency at which Methode Electronics stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Methode Electronics' price changes. Investors will then calculate the volatility of Methode Electronics' stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Methode Electronics' volatility:

Historical Volatility

This type of stock volatility measures Methode Electronics' fluctuations based on previous trends. It's commonly used to predict Methode Electronics' future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.

Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for Methode Electronics' current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Methode Electronics' to be redeemed at a future date.
Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. Methode Electronics Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.

Methode Electronics Projected Return Density Against Market

Considering the 90-day investment horizon the stock has the beta coefficient of 1.8517 . This indicates as the benchmark fluctuates upward, the company is expected to outperform it on average. However, if the benchmark returns are projected to be negative, Methode Electronics will likely underperform.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Methode Electronics or Electronic Equipment, Instruments & Components sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Methode Electronics' price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Methode stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Methode Electronics has a negative alpha, implying that the risk taken by holding this instrument is not justified. The company is significantly underperforming NYSE Composite.
   Predicted Return Density   
       Returns  
Methode Electronics' volatility is measured either by using standard deviation or beta. Standard deviation will reflect the average amount of how methode stock's price will differ from the mean after some time.To get its calculation, you should first determine the mean price during the specified period then subtract that from each price point.

What Drives a Methode Electronics Price Volatility?

Several factors can influence a stock's market volatility:

Industry

Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.

Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.

The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.

Methode Electronics Stock Risk Measures

Considering the 90-day investment horizon the coefficient of variation of Methode Electronics is -501.19. The daily returns are distributed with a variance of 21.85 and standard deviation of 4.67. The mean deviation of Methode Electronics is currently at 2.5. For similar time horizon, the selected benchmark (NYSE Composite) has volatility of 0.56
α
Alpha over NYSE Composite
-1.08
β
Beta against NYSE Composite1.85
σ
Overall volatility
4.67
Ir
Information ratio -0.21

Methode Electronics Stock Return Volatility

Methode Electronics historical daily return volatility represents how much of Methode Electronics stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The firm has volatility of 4.6745% on return distribution over 90 days investment horizon. By contrast, NYSE Composite accepts 0.5731% volatility on return distribution over the 90 days horizon.
 Performance 
       Timeline  

About Methode Electronics Volatility

Volatility is a rate at which the price of Methode Electronics or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Methode Electronics may increase or decrease. In other words, similar to Methode's beta indicator, it measures the risk of Methode Electronics and helps estimate the fluctuations that may happen in a short period of time. So if prices of Methode Electronics fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.
Last ReportedProjected for 2024
Selling And Marketing Expenses144.9 M87.1 M
Methode Electronics' stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Methode Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Methode Electronics' price varies over time.

3 ways to utilize Methode Electronics' volatility to invest better

Higher Methode Electronics' stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Methode Electronics stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Methode Electronics stock volatility can provide helpful information for making investment decisions in the following ways:
  • Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Methode Electronics investment. A higher volatility means higher risk and potentially larger changes in value.
  • Identifying Opportunities: High volatility in Methode Electronics' stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
  • Diversification: Understanding how the volatility of Methode Electronics' stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Remember it's essential to remember that stock volatility is just one of many factors to consider when making investment decisions, and it should be used in conjunction with other fundamental and technical analysis tools.

Methode Electronics Investment Opportunity

Methode Electronics has a volatility of 4.67 and is 8.19 times more volatile than NYSE Composite. 41 percent of all equities and portfolios are less risky than Methode Electronics. You can use Methode Electronics to enhance the returns of your portfolios. The stock experiences a very speculative upward sentiment. Check odds of Methode Electronics to be traded at $14.73 in 90 days.

Modest diversification

The correlation between Methode Electronics and NYA is 0.23 (i.e., Modest diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Methode Electronics and NYA in the same portfolio, assuming nothing else is changed.

Methode Electronics Additional Risk Indicators

The analysis of Methode Electronics' secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Methode Electronics' investment and either accepting that risk or mitigating it. Along with some common measures of Methode Electronics stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

Methode Electronics Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Methode Electronics as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Methode Electronics' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Methode Electronics' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Methode Electronics.
When determining whether Methode Electronics offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Methode Electronics' financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Methode Electronics Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Methode Electronics Stock:
Check out Correlation Analysis to better understand how to build diversified portfolios, which includes a position in Methode Electronics. Also, note that the market value of any company could be tightly coupled with the direction of predictive economic indicators such as signals in income.
For more detail on how to invest in Methode Stock please use our How to Invest in Methode Electronics guide.
Note that the Methode Electronics information on this page should be used as a complementary analysis to other Methode Electronics' statistical models used 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.

Complementary Tools for Methode Stock analysis

When running Methode Electronics' price analysis, check to measure Methode Electronics' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Methode Electronics is operating at the current time. Most of Methode Electronics' value examination focuses on studying past and present price action to predict the probability of Methode Electronics' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Methode Electronics' price. Additionally, you may evaluate how the addition of Methode Electronics to your portfolios can decrease your overall portfolio volatility.
Portfolio Optimization
Compute new portfolio that will generate highest expected return given your specified tolerance for risk
Piotroski F Score
Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals
Insider Screener
Find insiders across different sectors to evaluate their impact on performance
AI Investment Finder
Use AI to screen and filter profitable investment opportunities
Sectors
List of equity sectors categorizing publicly traded companies based on their primary business activities
Fundamental Analysis
View fundamental data based on most recent published financial statements
Fundamentals Comparison
Compare fundamentals across multiple equities to find investing opportunities
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
Is Methode Electronics' industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Methode Electronics. If investors know Methode will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Methode Electronics listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
(0.97)
Dividend Share
0.56
Earnings Share
(1.63)
Revenue Per Share
31.999
Quarterly Revenue Growth
(0.07)
The market value of Methode Electronics is measured differently than its book value, which is the value of Methode that is recorded on the company's balance sheet. Investors also form their own opinion of Methode Electronics' value that differs from its market value or its book value, called intrinsic value, which is Methode Electronics' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Methode Electronics' market value can be influenced by many factors that don't directly affect Methode Electronics' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Methode Electronics' value and its price as these two are different measures arrived at by different means. Investors typically determine if Methode Electronics is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Methode Electronics' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.