Correlation Between Maxigen Biotech and Microelectronics
Can any of the company-specific risk be diversified away by investing in both Maxigen Biotech and Microelectronics 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 Maxigen Biotech and Microelectronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maxigen Biotech and Microelectronics Technology, you can compare the effects of market volatilities on Maxigen Biotech and Microelectronics 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 Maxigen Biotech with a short position of Microelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maxigen Biotech and Microelectronics.
Diversification Opportunities for Maxigen Biotech and Microelectronics
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Maxigen and Microelectronics is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Maxigen Biotech and Microelectronics Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microelectronics Tec and Maxigen Biotech 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 Maxigen Biotech are associated (or correlated) with Microelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microelectronics Tec has no effect on the direction of Maxigen Biotech i.e., Maxigen Biotech and Microelectronics go up and down completely randomly.
Pair Corralation between Maxigen Biotech and Microelectronics
Assuming the 90 days trading horizon Maxigen Biotech is expected to generate 1.22 times less return on investment than Microelectronics. But when comparing it to its historical volatility, Maxigen Biotech is 2.13 times less risky than Microelectronics. It trades about 0.17 of its potential returns per unit of risk. Microelectronics Technology is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 2,990 in Microelectronics Technology on October 25, 2024 and sell it today you would earn a total of 585.00 from holding Microelectronics Technology or generate 19.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maxigen Biotech vs. Microelectronics Technology
Performance |
| Timeline |
| Maxigen Biotech |
| Microelectronics Tec |
Maxigen Biotech and Microelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maxigen Biotech and Microelectronics
The main advantage of trading using opposite Maxigen Biotech and Microelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maxigen Biotech position performs unexpectedly, Microelectronics 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 Microelectronics will offset losses from the drop in Microelectronics' long position.| Maxigen Biotech vs. Healthconn Corp | Maxigen Biotech vs. Cleanaway Co | Maxigen Biotech vs. PChome Online | Maxigen Biotech vs. Sunmax Biotechnology Co |
| Microelectronics vs. Unimicron Technology Corp | Microelectronics vs. Kinsus Interconnect Technology | Microelectronics vs. Novatek Microelectronics Corp | Microelectronics vs. Delta Electronics |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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