Correlation Between MEDIPOST and Solution Advanced
Can any of the company-specific risk be diversified away by investing in both MEDIPOST and Solution Advanced 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 Solution Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MEDIPOST Co and Solution Advanced Technology, you can compare the effects of market volatilities on MEDIPOST and Solution Advanced 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 Solution Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEDIPOST and Solution Advanced.
Diversification Opportunities for MEDIPOST and Solution Advanced
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MEDIPOST and Solution is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding MEDIPOST Co and Solution Advanced Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solution Advanced 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 Solution Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solution Advanced has no effect on the direction of MEDIPOST i.e., MEDIPOST and Solution Advanced go up and down completely randomly.
Pair Corralation between MEDIPOST and Solution Advanced
Assuming the 90 days trading horizon MEDIPOST Co is expected to generate 1.1 times more return on investment than Solution Advanced. However, MEDIPOST is 1.1 times more volatile than Solution Advanced Technology. It trades about 0.07 of its potential returns per unit of risk. Solution Advanced Technology is currently generating about -0.06 per unit of risk. If you would invest 719,000 in MEDIPOST Co on September 14, 2024 and sell it today you would earn a total of 467,000 from holding MEDIPOST Co or generate 64.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.62% |
| Values | Daily Returns |
MEDIPOST Co vs. Solution Advanced Technology
Performance |
| Timeline |
| MEDIPOST |
| Solution Advanced |
MEDIPOST and Solution Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MEDIPOST and Solution Advanced
The main advantage of trading using opposite MEDIPOST and Solution Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MEDIPOST position performs unexpectedly, Solution Advanced 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 Solution Advanced will offset losses from the drop in Solution Advanced's long position.| MEDIPOST vs. Ssangyong Information Communication | MEDIPOST vs. Koryo Credit Information | MEDIPOST vs. Korea Information Engineering | MEDIPOST vs. Daishin Information Communications |
| Solution Advanced vs. Samsung Electronics Co | Solution Advanced vs. Samsung Electronics Co | Solution Advanced vs. LG Energy Solution | Solution Advanced 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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