Correlation Between MClean Technologies and Minetech Resources
Can any of the company-specific risk be diversified away by investing in both MClean Technologies and Minetech Resources 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 MClean Technologies and Minetech Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MClean Technologies Bhd and Minetech Resources Bhd, you can compare the effects of market volatilities on MClean Technologies and Minetech Resources 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 MClean Technologies with a short position of Minetech Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of MClean Technologies and Minetech Resources.
Diversification Opportunities for MClean Technologies and Minetech Resources
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MClean and Minetech is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding MClean Technologies Bhd and Minetech Resources Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Minetech Resources Bhd and MClean Technologies 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 MClean Technologies Bhd are associated (or correlated) with Minetech Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Minetech Resources Bhd has no effect on the direction of MClean Technologies i.e., MClean Technologies and Minetech Resources go up and down completely randomly.
Pair Corralation between MClean Technologies and Minetech Resources
Assuming the 90 days trading horizon MClean Technologies Bhd is expected to generate 0.42 times more return on investment than Minetech Resources. However, MClean Technologies Bhd is 2.37 times less risky than Minetech Resources. It trades about 0.01 of its potential returns per unit of risk. Minetech Resources Bhd is currently generating about -0.24 per unit of risk. If you would invest 29.00 in MClean Technologies Bhd on November 28, 2024 and sell it today you would earn a total of 0.00 from holding MClean Technologies Bhd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MClean Technologies Bhd vs. Minetech Resources Bhd
Performance |
| Timeline |
| MClean Technologies Bhd |
| Minetech Resources Bhd |
MClean Technologies and Minetech Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MClean Technologies and Minetech Resources
The main advantage of trading using opposite MClean Technologies and Minetech Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MClean Technologies position performs unexpectedly, Minetech Resources 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 Minetech Resources will offset losses from the drop in Minetech Resources' long position.| MClean Technologies vs. Sunway Construction Group | MClean Technologies vs. DC HEALTHCARE HOLDINGS | MClean Technologies vs. Sports Toto Berhad | MClean Technologies vs. TAS Offshore Bhd |
| Minetech Resources vs. EA Technique M | Minetech Resources vs. Saudee Group Bhd | Minetech Resources vs. Digistar Bhd | Minetech Resources vs. AirAsia X 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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