Correlation Between MasterBeef Group and Vanguard Sumer

Can any of the company-specific risk be diversified away by investing in both MasterBeef Group and Vanguard Sumer 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 MasterBeef Group and Vanguard Sumer into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MasterBeef Group Ordinary and Vanguard Sumer Discretionary, you can compare the effects of market volatilities on MasterBeef Group and Vanguard Sumer 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 MasterBeef Group with a short position of Vanguard Sumer. Check out your portfolio center. Please also check ongoing floating volatility patterns of MasterBeef Group and Vanguard Sumer.

Diversification Opportunities for MasterBeef Group and Vanguard Sumer

0.76

Correlation Coefficient

MasterBeef Group  Vanguard Sumer

Poor diversification

The 3 months correlation between MasterBeef and Vanguard is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding MasterBeef Group Ordinary and Vanguard Sumer Discretionary in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Sumer Discr and MasterBeef 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 MasterBeef Group Ordinary are associated (or correlated) with Vanguard Sumer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Sumer Discr has no effect on the direction of MasterBeef Group i.e., MasterBeef Group and Vanguard Sumer go up and down completely randomly.

Pair Corralation between MasterBeef Group and Vanguard Sumer

Allowing for the 90-day total investment horizon MasterBeef Group Ordinary is expected to generate 7.31 times more return on investment than Vanguard Sumer. However, MasterBeef Group is 7.31 times more volatile than Vanguard Sumer Discretionary. It trades about 0.31 of its potential returns per unit of risk. Vanguard Sumer Discretionary is currently generating about 0.18 per unit of risk. If you would invest  320.00  in MasterBeef Group Ordinary on May 1, 2025 and sell it today you would earn a total of  1,090  from holding MasterBeef Group Ordinary or generate 340.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

MasterBeef Group Ordinary  vs.  Vanguard Sumer Discretionary

MasterBeef Group Ordinary

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in MasterBeef Group Ordinary are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. Despite somewhat inconsistent fundamental drivers, MasterBeef Group sustained solid returns over the last few months and may actually be approaching a breakup point.

Vanguard Sumer Discr

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vanguard Sumer Discretionary are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Vanguard Sumer showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with MasterBeef Group and Vanguard Sumer

The main advantage of trading using opposite MasterBeef Group and Vanguard Sumer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MasterBeef Group position performs unexpectedly, Vanguard Sumer 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 Vanguard Sumer will offset losses from the drop in Vanguard Sumer's long position.

The idea behind MasterBeef Group Ordinary and Vanguard Sumer Discretionary pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.