Correlation Between Mesirow Financial and Financial Industries
Can any of the company-specific risk be diversified away by investing in both Mesirow Financial and Financial Industries 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 Mesirow Financial and Financial Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mesirow Financial Small and Financial Industries Fund, you can compare the effects of market volatilities on Mesirow Financial and Financial Industries 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 Mesirow Financial with a short position of Financial Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mesirow Financial and Financial Industries.
Diversification Opportunities for Mesirow Financial and Financial Industries
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mesirow and Financial is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Mesirow Financial Small and Financial Industries Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Financial Industries and Mesirow Financial 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 Mesirow Financial Small are associated (or correlated) with Financial Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Financial Industries has no effect on the direction of Mesirow Financial i.e., Mesirow Financial and Financial Industries go up and down completely randomly.
Pair Corralation between Mesirow Financial and Financial Industries
Assuming the 90 days horizon Mesirow Financial Small is expected to under-perform the Financial Industries. In addition to that, Mesirow Financial is 1.07 times more volatile than Financial Industries Fund. It trades about 0.0 of its total potential returns per unit of risk. Financial Industries Fund is currently generating about 0.01 per unit of volatility. If you would invest 1,832 in Financial Industries Fund on March 23, 2025 and sell it today you would lose (6.00) from holding Financial Industries Fund or give up 0.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mesirow Financial Small vs. Financial Industries Fund
Performance |
| Timeline |
| Mesirow Financial Small |
| Financial Industries |
Mesirow Financial and Financial Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mesirow Financial and Financial Industries
The main advantage of trading using opposite Mesirow Financial and Financial Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mesirow Financial position performs unexpectedly, Financial Industries 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 Financial Industries will offset losses from the drop in Financial Industries' long position.| Mesirow Financial vs. Voya Real Estate | Mesirow Financial vs. Prudential Real Estate | Mesirow Financial vs. Sa Real Estate | Mesirow Financial vs. Aew Real Estate |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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