Correlation Between JF Technology and MClean Technologies
Can any of the company-specific risk be diversified away by investing in both JF Technology and MClean Technologies 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 JF Technology and MClean Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JF Technology BHD and MClean Technologies Bhd, you can compare the effects of market volatilities on JF Technology and MClean Technologies 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 JF Technology with a short position of MClean Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of JF Technology and MClean Technologies.
Diversification Opportunities for JF Technology and MClean Technologies
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between 0146 and MClean is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding JF Technology BHD and MClean Technologies Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MClean Technologies Bhd and JF 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 JF Technology BHD are associated (or correlated) with MClean Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MClean Technologies Bhd has no effect on the direction of JF Technology i.e., JF Technology and MClean Technologies go up and down completely randomly.
Pair Corralation between JF Technology and MClean Technologies
Assuming the 90 days trading horizon JF Technology BHD is expected to generate 0.71 times more return on investment than MClean Technologies. However, JF Technology BHD is 1.41 times less risky than MClean Technologies. It trades about -0.16 of its potential returns per unit of risk. MClean Technologies Bhd is currently generating about -0.12 per unit of risk. If you would invest 69.00 in JF Technology BHD on August 29, 2024 and sell it today you would lose (16.00) from holding JF Technology BHD or give up 23.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
JF Technology BHD vs. MClean Technologies Bhd
Performance |
| Timeline |
| JF Technology BHD |
| MClean Technologies Bhd |
JF Technology and MClean Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JF Technology and MClean Technologies
The main advantage of trading using opposite JF Technology and MClean Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JF Technology position performs unexpectedly, MClean Technologies 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 MClean Technologies will offset losses from the drop in MClean Technologies' long position.| JF Technology vs. Minetech Resources Bhd | JF Technology vs. Senheng New Retail | JF Technology vs. PIE Industrial Bhd | JF Technology vs. ONETECH SOLUTIONS HOLDINGS |
| MClean Technologies vs. Computer Forms Bhd | MClean Technologies vs. Tex Cycle Technology | MClean Technologies vs. Minetech Resources Bhd | MClean Technologies vs. Sunzen Biotech Bhd |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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