Correlation Between MQ Technology and Leader Steel
Can any of the company-specific risk be diversified away by investing in both MQ Technology and Leader Steel 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 Leader Steel 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 Leader Steel Holdings, you can compare the effects of market volatilities on MQ Technology and Leader Steel 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 Leader Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of MQ Technology and Leader Steel.
Diversification Opportunities for MQ Technology and Leader Steel
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 0070 and Leader is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding MQ Technology Bhd and Leader Steel Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leader Steel Holdings 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 Leader Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leader Steel Holdings has no effect on the direction of MQ Technology i.e., MQ Technology and Leader Steel go up and down completely randomly.
Pair Corralation between MQ Technology and Leader Steel
Assuming the 90 days trading horizon MQ Technology Bhd is expected to generate 6.57 times more return on investment than Leader Steel. However, MQ Technology is 6.57 times more volatile than Leader Steel Holdings. It trades about 0.05 of its potential returns per unit of risk. Leader Steel Holdings is currently generating about -0.1 per unit of risk. If you would invest 15.00 in MQ Technology Bhd on October 25, 2024 and sell it today you would lose (5.00) from holding MQ Technology Bhd or give up 33.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MQ Technology Bhd vs. Leader Steel Holdings
Performance |
| Timeline |
| MQ Technology Bhd |
| Leader Steel Holdings |
MQ Technology and Leader Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MQ Technology and Leader Steel
The main advantage of trading using opposite MQ Technology and Leader Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MQ Technology position performs unexpectedly, Leader Steel 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 Leader Steel will offset losses from the drop in Leader Steel's long position.| MQ Technology vs. Tex Cycle Technology | MQ Technology vs. Eonmetall Group Bhd | MQ Technology vs. PIE Industrial Bhd | MQ Technology vs. CB Industrial Product |
| Leader Steel vs. Press Metal Bhd | Leader Steel vs. PMB Technology Bhd | Leader Steel vs. Pantech Group Holdings | Leader Steel vs. CSC Steel 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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