Correlation Between MS Autotech and HyVision System
Can any of the company-specific risk be diversified away by investing in both MS Autotech and HyVision System 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 HyVision System 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 HyVision System, you can compare the effects of market volatilities on MS Autotech and HyVision System 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 HyVision System. Check out your portfolio center. Please also check ongoing floating volatility patterns of MS Autotech and HyVision System.
Diversification Opportunities for MS Autotech and HyVision System
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 123040 and HyVision is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding MS Autotech CoLtd and HyVision System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HyVision System 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 HyVision System. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HyVision System has no effect on the direction of MS Autotech i.e., MS Autotech and HyVision System go up and down completely randomly.
Pair Corralation between MS Autotech and HyVision System
Assuming the 90 days trading horizon MS Autotech CoLtd is expected to under-perform the HyVision System. But the stock apears to be less risky and, when comparing its historical volatility, MS Autotech CoLtd is 1.28 times less risky than HyVision System. The stock trades about -0.15 of its potential returns per unit of risk. The HyVision System is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest 2,400,000 in HyVision System on September 3, 2024 and sell it today you would lose (801,000) from holding HyVision System or give up 33.37% 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. HyVision System
Performance |
| Timeline |
| MS Autotech CoLtd |
| HyVision System |
MS Autotech and HyVision System Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MS Autotech and HyVision System
The main advantage of trading using opposite MS Autotech and HyVision System positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MS Autotech position performs unexpectedly, HyVision System 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 HyVision System will offset losses from the drop in HyVision System's long position.| MS Autotech vs. EV Advanced Material | MS Autotech vs. Top Material Co | MS Autotech vs. Shinsegae Food | MS Autotech vs. Foodnamoo |
| HyVision System vs. Chorokbaem Healthcare Co | HyVision System vs. KyungIn Electronics Co | HyVision System vs. Daejoo Electronic Materials | HyVision System vs. LG Household Healthcare |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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