Correlation Between AP Moeller and Federated Mdt
Can any of the company-specific risk be diversified away by investing in both AP Moeller and Federated Mdt 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 AP Moeller and Federated Mdt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AP Moeller Maersk AS and Federated Mdt Large, you can compare the effects of market volatilities on AP Moeller and Federated Mdt 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 AP Moeller with a short position of Federated Mdt. Check out your portfolio center. Please also check ongoing floating volatility patterns of AP Moeller and Federated Mdt.
Diversification Opportunities for AP Moeller and Federated Mdt
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AMKBY and Federated is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding AP Moeller Maersk AS and Federated Mdt Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Mdt Large and AP Moeller 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 AP Moeller Maersk AS are associated (or correlated) with Federated Mdt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Mdt Large has no effect on the direction of AP Moeller i.e., AP Moeller and Federated Mdt go up and down completely randomly.
Pair Corralation between AP Moeller and Federated Mdt
Assuming the 90 days horizon AP Moeller Maersk AS is expected to generate 3.45 times more return on investment than Federated Mdt. However, AP Moeller is 3.45 times more volatile than Federated Mdt Large. It trades about 0.12 of its potential returns per unit of risk. Federated Mdt Large is currently generating about 0.18 per unit of risk. If you would invest 899.00 in AP Moeller Maersk AS on May 30, 2025 and sell it today you would earn a total of 139.00 from holding AP Moeller Maersk AS or generate 15.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AP Moeller Maersk AS vs. Federated Mdt Large
Performance |
| Timeline |
| AP Moeller Maersk |
| Federated Mdt Large |
AP Moeller and Federated Mdt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AP Moeller and Federated Mdt
The main advantage of trading using opposite AP Moeller and Federated Mdt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AP Moeller position performs unexpectedly, Federated Mdt 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 Federated Mdt will offset losses from the drop in Federated Mdt's long position.| AP Moeller vs. Hapag Lloyd Aktiengesellschaft | AP Moeller vs. COSCO SHIPPING Holdings | AP Moeller vs. Nippon Yusen Kabushiki | AP Moeller vs. AP Mller |
| Federated Mdt vs. Ab Bond Inflation | Federated Mdt vs. Ab Bond Inflation | Federated Mdt vs. The Short Term Municipal | Federated Mdt vs. Leader Short Term Bond |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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