Correlation Between Mirae Asset and Solution Advanced
Can any of the company-specific risk be diversified away by investing in both Mirae Asset and Solution Advanced 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 Mirae Asset and Solution Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mirae Asset Daewoo and Solution Advanced Technology, you can compare the effects of market volatilities on Mirae Asset and Solution Advanced 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 Mirae Asset with a short position of Solution Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mirae Asset and Solution Advanced.
Diversification Opportunities for Mirae Asset and Solution Advanced
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mirae and Solution is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Mirae Asset Daewoo and Solution Advanced Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solution Advanced and Mirae Asset 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 Mirae Asset Daewoo are associated (or correlated) with Solution Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solution Advanced has no effect on the direction of Mirae Asset i.e., Mirae Asset and Solution Advanced go up and down completely randomly.
Pair Corralation between Mirae Asset and Solution Advanced
Assuming the 90 days trading horizon Mirae Asset Daewoo is expected to generate 0.51 times more return on investment than Solution Advanced. However, Mirae Asset Daewoo is 1.97 times less risky than Solution Advanced. It trades about 0.02 of its potential returns per unit of risk. Solution Advanced Technology is currently generating about -0.03 per unit of risk. If you would invest 389,489 in Mirae Asset Daewoo on September 3, 2024 and sell it today you would earn a total of 58,511 from holding Mirae Asset Daewoo or generate 15.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mirae Asset Daewoo vs. Solution Advanced Technology
Performance |
| Timeline |
| Mirae Asset Daewoo |
| Solution Advanced |
Mirae Asset and Solution Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mirae Asset and Solution Advanced
The main advantage of trading using opposite Mirae Asset and Solution Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mirae Asset position performs unexpectedly, Solution Advanced 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 Solution Advanced will offset losses from the drop in Solution Advanced's long position.| Mirae Asset vs. Samlip General Foods | Mirae Asset vs. Pureun Mutual Savings | Mirae Asset vs. Sam Yang Foods | Mirae Asset vs. Samsung Life Insurance |
| Solution Advanced vs. LB Investment | Solution Advanced vs. Lindeman Asia Investment | Solution Advanced vs. FoodNamoo | Solution Advanced vs. Korea Investment Holdings |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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