Correlation Between Miwon Chemicals and Asia Technology
Can any of the company-specific risk be diversified away by investing in both Miwon Chemicals and Asia Technology 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 Miwon Chemicals and Asia Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Miwon Chemicals Co and Asia Technology Co, you can compare the effects of market volatilities on Miwon Chemicals and Asia Technology 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 Miwon Chemicals with a short position of Asia Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Miwon Chemicals and Asia Technology.
Diversification Opportunities for Miwon Chemicals and Asia Technology
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Miwon and Asia is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Miwon Chemicals Co and Asia Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Technology and Miwon Chemicals 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 Miwon Chemicals Co are associated (or correlated) with Asia Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Technology has no effect on the direction of Miwon Chemicals i.e., Miwon Chemicals and Asia Technology go up and down completely randomly.
Pair Corralation between Miwon Chemicals and Asia Technology
Assuming the 90 days trading horizon Miwon Chemicals Co is expected to generate 0.94 times more return on investment than Asia Technology. However, Miwon Chemicals Co is 1.06 times less risky than Asia Technology. It trades about 0.14 of its potential returns per unit of risk. Asia Technology Co is currently generating about -0.03 per unit of risk. If you would invest 7,698,726 in Miwon Chemicals Co on October 11, 2024 and sell it today you would earn a total of 251,274 from holding Miwon Chemicals Co or generate 3.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Miwon Chemicals Co vs. Asia Technology Co
Performance |
| Timeline |
| Miwon Chemicals |
| Asia Technology |
Miwon Chemicals and Asia Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Miwon Chemicals and Asia Technology
The main advantage of trading using opposite Miwon Chemicals and Asia Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Miwon Chemicals position performs unexpectedly, Asia Technology 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 Asia Technology will offset losses from the drop in Asia Technology's long position.| Miwon Chemicals vs. Hanmi Semiconductor Co | Miwon Chemicals vs. LG Household Healthcare | Miwon Chemicals vs. Asiana Airlines | Miwon Chemicals vs. Ssangyong Information Communication |
| Asia Technology vs. Miwon Chemicals Co | Asia Technology vs. SEOJEON ELECTRIC MACHINERY | Asia Technology vs. Hanshin Construction Co | Asia Technology vs. SK Chemicals 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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