Correlation Between MS Autotech and IM CoLtd
Can any of the company-specific risk be diversified away by investing in both MS Autotech and IM CoLtd 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 IM CoLtd 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 IM CoLtd, you can compare the effects of market volatilities on MS Autotech and IM CoLtd 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 IM CoLtd. Check out your portfolio center. Please also check ongoing floating volatility patterns of MS Autotech and IM CoLtd.
Diversification Opportunities for MS Autotech and IM CoLtd
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 123040 and 101390 is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding MS Autotech CoLtd and IM CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IM CoLtd 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 IM CoLtd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IM CoLtd has no effect on the direction of MS Autotech i.e., MS Autotech and IM CoLtd go up and down completely randomly.
Pair Corralation between MS Autotech and IM CoLtd
Assuming the 90 days trading horizon MS Autotech CoLtd is expected to generate 0.44 times more return on investment than IM CoLtd. However, MS Autotech CoLtd is 2.29 times less risky than IM CoLtd. It trades about -0.17 of its potential returns per unit of risk. IM CoLtd is currently generating about -0.15 per unit of risk. If you would invest 450,500 in MS Autotech CoLtd on September 3, 2024 and sell it today you would lose (180,500) from holding MS Autotech CoLtd or give up 40.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MS Autotech CoLtd vs. IM CoLtd
Performance |
| Timeline |
| MS Autotech CoLtd |
| IM CoLtd |
MS Autotech and IM CoLtd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MS Autotech and IM CoLtd
The main advantage of trading using opposite MS Autotech and IM CoLtd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MS Autotech position performs unexpectedly, IM CoLtd 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 IM CoLtd will offset losses from the drop in IM CoLtd's long position.| MS Autotech vs. EV Advanced Material | MS Autotech vs. Top Material Co | MS Autotech vs. Shinsegae Food | MS Autotech vs. Foodnamoo |
| IM CoLtd vs. LG Electronics Pfd | IM CoLtd vs. Sunny Electronics Corp | IM CoLtd vs. Dongbang Transport Logistics | IM CoLtd vs. Daeduck Electronics Co |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |