Correlation Between MQ Technology and ES Ceramics
Can any of the company-specific risk be diversified away by investing in both MQ Technology and ES Ceramics 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 MQ Technology and ES Ceramics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MQ Technology Bhd and ES Ceramics Technology, you can compare the effects of market volatilities on MQ Technology and ES Ceramics 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 MQ Technology with a short position of ES Ceramics. Check out your portfolio center. Please also check ongoing floating volatility patterns of MQ Technology and ES Ceramics.
Diversification Opportunities for MQ Technology and ES Ceramics
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 0070 and 0100 is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding MQ Technology Bhd and ES Ceramics Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ES Ceramics Technology and MQ Technology 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 MQ Technology Bhd are associated (or correlated) with ES Ceramics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ES Ceramics Technology has no effect on the direction of MQ Technology i.e., MQ Technology and ES Ceramics go up and down completely randomly.
Pair Corralation between MQ Technology and ES Ceramics
Assuming the 90 days trading horizon MQ Technology Bhd is expected to generate 8.07 times more return on investment than ES Ceramics. However, MQ Technology is 8.07 times more volatile than ES Ceramics Technology. It trades about 0.06 of its potential returns per unit of risk. ES Ceramics Technology is currently generating about 0.0 per unit of risk. If you would invest 55.00 in MQ Technology Bhd on October 23, 2024 and sell it today you would lose (45.00) from holding MQ Technology Bhd or give up 81.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MQ Technology Bhd vs. ES Ceramics Technology
Performance |
| Timeline |
| MQ Technology Bhd |
| ES Ceramics Technology |
MQ Technology and ES Ceramics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MQ Technology and ES Ceramics
The main advantage of trading using opposite MQ Technology and ES Ceramics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MQ Technology position performs unexpectedly, ES Ceramics 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 ES Ceramics will offset losses from the drop in ES Ceramics' long position.| MQ Technology vs. Lotte Chemical Titan | MQ Technology vs. MClean Technologies Bhd | MQ Technology vs. IHH Healthcare Bhd | MQ Technology vs. DC HEALTHCARE HOLDINGS |
| ES Ceramics vs. YX Precious Metals | ES Ceramics vs. Melewar Industrial Group | ES Ceramics vs. Mercury Industries Bhd | ES Ceramics vs. Star Media Group |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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