Correlation Between Radiant Globaltech and Mycron Steel
Can any of the company-specific risk be diversified away by investing in both Radiant Globaltech and Mycron 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 Radiant Globaltech and Mycron Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Radiant Globaltech Bhd and Mycron Steel Bhd, you can compare the effects of market volatilities on Radiant Globaltech and Mycron 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 Radiant Globaltech with a short position of Mycron Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Radiant Globaltech and Mycron Steel.
Diversification Opportunities for Radiant Globaltech and Mycron Steel
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Radiant and Mycron is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Radiant Globaltech Bhd and Mycron Steel Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mycron Steel Bhd and Radiant Globaltech 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 Radiant Globaltech Bhd are associated (or correlated) with Mycron Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mycron Steel Bhd has no effect on the direction of Radiant Globaltech i.e., Radiant Globaltech and Mycron Steel go up and down completely randomly.
Pair Corralation between Radiant Globaltech and Mycron Steel
Assuming the 90 days trading horizon Radiant Globaltech is expected to generate 9.96 times less return on investment than Mycron Steel. But when comparing it to its historical volatility, Radiant Globaltech Bhd is 1.81 times less risky than Mycron Steel. It trades about 0.01 of its potential returns per unit of risk. Mycron Steel Bhd is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 35.00 in Mycron Steel Bhd on September 4, 2024 and sell it today you would earn a total of 1.00 from holding Mycron Steel Bhd or generate 2.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Radiant Globaltech Bhd vs. Mycron Steel Bhd
Performance |
| Timeline |
| Radiant Globaltech Bhd |
| Mycron Steel Bhd |
Radiant Globaltech and Mycron Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Radiant Globaltech and Mycron Steel
The main advantage of trading using opposite Radiant Globaltech and Mycron Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Radiant Globaltech position performs unexpectedly, Mycron 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 Mycron Steel will offset losses from the drop in Mycron Steel's long position.| Radiant Globaltech vs. Mr D I | Radiant Globaltech vs. Minetech Resources Bhd | Radiant Globaltech vs. Swift Haulage Bhd | Radiant Globaltech vs. Insas Bhd |
| Mycron Steel vs. Sunzen Biotech Bhd | Mycron Steel vs. Choo Bee Metal | Mycron Steel vs. Radiant Globaltech Bhd | Mycron Steel vs. Supercomnet Technologies 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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