Correlation Between MEDIPOST and Sang A
Can any of the company-specific risk be diversified away by investing in both MEDIPOST and Sang A 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 MEDIPOST and Sang A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MEDIPOST Co and Sang A Frontec CoLtd, you can compare the effects of market volatilities on MEDIPOST and Sang A 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 MEDIPOST with a short position of Sang A. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEDIPOST and Sang A.
Diversification Opportunities for MEDIPOST and Sang A
Excellent diversification
The 3 months correlation between MEDIPOST and Sang is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding MEDIPOST Co and Sang A Frontec CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sang A Frontec and MEDIPOST 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 MEDIPOST Co are associated (or correlated) with Sang A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sang A Frontec has no effect on the direction of MEDIPOST i.e., MEDIPOST and Sang A go up and down completely randomly.
Pair Corralation between MEDIPOST and Sang A
Assuming the 90 days trading horizon MEDIPOST Co is expected to generate 2.78 times more return on investment than Sang A. However, MEDIPOST is 2.78 times more volatile than Sang A Frontec CoLtd. It trades about 0.17 of its potential returns per unit of risk. Sang A Frontec CoLtd is currently generating about -0.07 per unit of risk. If you would invest 662,000 in MEDIPOST Co on October 1, 2024 and sell it today you would earn a total of 364,000 from holding MEDIPOST Co or generate 54.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MEDIPOST Co vs. Sang A Frontec CoLtd
Performance |
| Timeline |
| MEDIPOST |
| Sang A Frontec |
MEDIPOST and Sang A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MEDIPOST and Sang A
The main advantage of trading using opposite MEDIPOST and Sang A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MEDIPOST position performs unexpectedly, Sang A 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 Sang A will offset losses from the drop in Sang A's long position.The idea behind MEDIPOST Co and Sang A Frontec CoLtd pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Sang A vs. Dongsin Engineering Construction | Sang A vs. Doosan Fuel Cell | Sang A vs. Daishin Balance 1 | Sang A vs. Total Soft Bank |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |