Correlation Between MS Autotech and HANA Micron
Can any of the company-specific risk be diversified away by investing in both MS Autotech and HANA Micron 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 MS Autotech and HANA Micron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MS Autotech CoLtd and HANA Micron, you can compare the effects of market volatilities on MS Autotech and HANA Micron 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 MS Autotech with a short position of HANA Micron. Check out your portfolio center. Please also check ongoing floating volatility patterns of MS Autotech and HANA Micron.
Diversification Opportunities for MS Autotech and HANA Micron
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between 123040 and HANA is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding MS Autotech CoLtd and HANA Micron in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HANA Micron and MS Autotech 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 MS Autotech CoLtd are associated (or correlated) with HANA Micron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HANA Micron has no effect on the direction of MS Autotech i.e., MS Autotech and HANA Micron go up and down completely randomly.
Pair Corralation between MS Autotech and HANA Micron
Assuming the 90 days trading horizon MS Autotech CoLtd is expected to under-perform the HANA Micron. But the stock apears to be less risky and, when comparing its historical volatility, MS Autotech CoLtd is 1.93 times less risky than HANA Micron. The stock trades about -0.05 of its potential returns per unit of risk. The HANA Micron is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 977,635 in HANA Micron on September 1, 2024 and sell it today you would lose (14,635) from holding HANA Micron or give up 1.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.77% |
| Values | Daily Returns |
MS Autotech CoLtd vs. HANA Micron
Performance |
| Timeline |
| MS Autotech CoLtd |
| HANA Micron |
MS Autotech and HANA Micron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MS Autotech and HANA Micron
The main advantage of trading using opposite MS Autotech and HANA Micron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MS Autotech position performs unexpectedly, HANA Micron 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 HANA Micron will offset losses from the drop in HANA Micron's long position.| MS Autotech vs. LG Display | MS Autotech vs. Hyundai Motor | MS Autotech vs. Hyundai Motor Co | MS Autotech vs. Hyundai Motor Co |
| HANA Micron vs. Shinil Electronics Co | HANA Micron vs. Miwon Chemical | HANA Micron vs. DAEDUCK ELECTRONICS CoLtd | HANA Micron vs. TK Chemical |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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