Correlation Between Microfriend and SBI Investment
Can any of the company-specific risk be diversified away by investing in both Microfriend and SBI Investment 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 Microfriend and SBI Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microfriend and SBI Investment KOREA, you can compare the effects of market volatilities on Microfriend and SBI Investment 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 Microfriend with a short position of SBI Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microfriend and SBI Investment.
Diversification Opportunities for Microfriend and SBI Investment
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Microfriend and SBI is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Microfriend and SBI Investment KOREA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SBI Investment KOREA and Microfriend 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 Microfriend are associated (or correlated) with SBI Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SBI Investment KOREA has no effect on the direction of Microfriend i.e., Microfriend and SBI Investment go up and down completely randomly.
Pair Corralation between Microfriend and SBI Investment
Assuming the 90 days trading horizon Microfriend is expected to generate 1.48 times more return on investment than SBI Investment. However, Microfriend is 1.48 times more volatile than SBI Investment KOREA. It trades about -0.02 of its potential returns per unit of risk. SBI Investment KOREA is currently generating about -0.03 per unit of risk. If you would invest 515,000 in Microfriend on October 20, 2024 and sell it today you would lose (232,500) from holding Microfriend or give up 45.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microfriend vs. SBI Investment KOREA
Performance |
| Timeline |
| Microfriend |
| SBI Investment KOREA |
Microfriend and SBI Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microfriend and SBI Investment
The main advantage of trading using opposite Microfriend and SBI Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microfriend position performs unexpectedly, SBI Investment 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 SBI Investment will offset losses from the drop in SBI Investment's long position.| Microfriend vs. Eagle Veterinary Technology | Microfriend vs. JC Chemical Co | Microfriend vs. SEOWONINTECHCoLtd | Microfriend vs. Youl Chon Chemical |
| SBI Investment vs. Heungkuk Metaltech CoLtd | SBI Investment vs. Digital Imaging Technology | SBI Investment vs. NewFlex Technology Co | SBI Investment vs. Seers Technology |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |