Correlation Between Clean Science and Mirae Asset
Can any of the company-specific risk be diversified away by investing in both Clean Science and Mirae Asset 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 Clean Science and Mirae Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clean Science co and Mirae Asset Daewoo, you can compare the effects of market volatilities on Clean Science and Mirae Asset 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 Clean Science with a short position of Mirae Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clean Science and Mirae Asset.
Diversification Opportunities for Clean Science and Mirae Asset
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Clean and Mirae is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Clean Science co and Mirae Asset Daewoo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirae Asset Daewoo and Clean Science 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 Clean Science co are associated (or correlated) with Mirae Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirae Asset Daewoo has no effect on the direction of Clean Science i.e., Clean Science and Mirae Asset go up and down completely randomly.
Pair Corralation between Clean Science and Mirae Asset
Assuming the 90 days trading horizon Clean Science co is expected to under-perform the Mirae Asset. But the stock apears to be less risky and, when comparing its historical volatility, Clean Science co is 1.18 times less risky than Mirae Asset. The stock trades about -0.08 of its potential returns per unit of risk. The Mirae Asset Daewoo is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 394,500 in Mirae Asset Daewoo on August 30, 2024 and sell it today you would earn a total of 57,500 from holding Mirae Asset Daewoo or generate 14.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clean Science co vs. Mirae Asset Daewoo
Performance |
| Timeline |
| Clean Science co |
| Mirae Asset Daewoo |
Clean Science and Mirae Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clean Science and Mirae Asset
The main advantage of trading using opposite Clean Science and Mirae Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clean Science position performs unexpectedly, Mirae Asset 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 Mirae Asset will offset losses from the drop in Mirae Asset's long position.| Clean Science vs. Samsung Electronics Co | Clean Science vs. Samsung Electronics Co | Clean Science vs. KB Financial Group | Clean Science vs. Shinhan Financial Group |
| Mirae Asset vs. Samsung Electronics Co | Mirae Asset vs. Samsung Electronics Co | Mirae Asset vs. LG Energy Solution | Mirae Asset vs. SK Hynix |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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