Correlation Between Mohawk Group and Fabrinet
Can any of the company-specific risk be diversified away by investing in both Mohawk Group and Fabrinet 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 Mohawk Group and Fabrinet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mohawk Group Holdings and Fabrinet, you can compare the effects of market volatilities on Mohawk Group and Fabrinet 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 Mohawk Group with a short position of Fabrinet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mohawk Group and Fabrinet.
Diversification Opportunities for Mohawk Group and Fabrinet
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mohawk and Fabrinet is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mohawk Group Holdings and Fabrinet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fabrinet and Mohawk Group 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 Mohawk Group Holdings are associated (or correlated) with Fabrinet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fabrinet has no effect on the direction of Mohawk Group i.e., Mohawk Group and Fabrinet go up and down completely randomly.
Pair Corralation between Mohawk Group and Fabrinet
If you would invest (100.00) in Mohawk Group Holdings on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Mohawk Group Holdings or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Mohawk Group Holdings vs. Fabrinet
Performance |
| Timeline |
| Mohawk Group Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Fabrinet |
Mohawk Group and Fabrinet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mohawk Group and Fabrinet
The main advantage of trading using opposite Mohawk Group and Fabrinet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mohawk Group position performs unexpectedly, Fabrinet 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 Fabrinet will offset losses from the drop in Fabrinet's long position.| Mohawk Group vs. Radcom | Mohawk Group vs. Haverty Furniture Companies | Mohawk Group vs. Iridium Communications | Mohawk Group vs. Weibo 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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