Correlation Between MS Autotech and Ace Technologies
Can any of the company-specific risk be diversified away by investing in both MS Autotech and Ace Technologies 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 Ace Technologies 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 Ace Technologies Corp, you can compare the effects of market volatilities on MS Autotech and Ace Technologies 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 Ace Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of MS Autotech and Ace Technologies.
Diversification Opportunities for MS Autotech and Ace Technologies
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 123040 and Ace is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding MS Autotech CoLtd and Ace Technologies Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ace Technologies Corp 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 Ace Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ace Technologies Corp has no effect on the direction of MS Autotech i.e., MS Autotech and Ace Technologies go up and down completely randomly.
Pair Corralation between MS Autotech and Ace Technologies
Assuming the 90 days trading horizon MS Autotech CoLtd is expected to generate 0.36 times more return on investment than Ace Technologies. However, MS Autotech CoLtd is 2.82 times less risky than Ace Technologies. It trades about -0.05 of its potential returns per unit of risk. Ace Technologies Corp is currently generating about -0.04 per unit of risk. If you would invest 468,579 in MS Autotech CoLtd on September 1, 2024 and sell it today you would lose (198,579) from holding MS Autotech CoLtd or give up 42.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MS Autotech CoLtd vs. Ace Technologies Corp
Performance |
| Timeline |
| MS Autotech CoLtd |
| Ace Technologies Corp |
MS Autotech and Ace Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MS Autotech and Ace Technologies
The main advantage of trading using opposite MS Autotech and Ace Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MS Autotech position performs unexpectedly, Ace Technologies 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 Ace Technologies will offset losses from the drop in Ace Technologies' long position.| MS Autotech vs. LG Display | MS Autotech vs. Hyundai Motor | MS Autotech vs. Hyundai Motor Co | MS Autotech vs. Hyundai Motor Co |
| Ace Technologies vs. Kmw Inc | Ace Technologies vs. NH SPAC 8 | Ace Technologies vs. Daejoo Electronic Materials | Ace Technologies vs. Seojin System CoLtd |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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