Correlation Between Maxigen Biotech and U Ming
Can any of the company-specific risk be diversified away by investing in both Maxigen Biotech and U Ming 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 U Ming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maxigen Biotech and U Ming Marine Transport, you can compare the effects of market volatilities on Maxigen Biotech and U Ming 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 U Ming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maxigen Biotech and U Ming.
Diversification Opportunities for Maxigen Biotech and U Ming
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Maxigen and 2606 is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Maxigen Biotech and U Ming Marine Transport in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on U Ming Marine 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 U Ming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of U Ming Marine has no effect on the direction of Maxigen Biotech i.e., Maxigen Biotech and U Ming go up and down completely randomly.
Pair Corralation between Maxigen Biotech and U Ming
Assuming the 90 days trading horizon Maxigen Biotech is expected to generate 1.25 times less return on investment than U Ming. In addition to that, Maxigen Biotech is 1.28 times more volatile than U Ming Marine Transport. It trades about 0.17 of its total potential returns per unit of risk. U Ming Marine Transport is currently generating about 0.27 per unit of volatility. If you would invest 5,570 in U Ming Marine Transport on September 1, 2024 and sell it today you would earn a total of 390.00 from holding U Ming Marine Transport or generate 7.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maxigen Biotech vs. U Ming Marine Transport
Performance |
| Timeline |
| Maxigen Biotech |
| U Ming Marine |
Maxigen Biotech and U Ming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maxigen Biotech and U Ming
The main advantage of trading using opposite Maxigen Biotech and U Ming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maxigen Biotech position performs unexpectedly, U Ming 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 U Ming will offset losses from the drop in U Ming's long position.| Maxigen Biotech vs. Phytohealth Corp | Maxigen Biotech vs. Orient Pharma Co | Maxigen Biotech vs. Yung Zip Chemical |
| U Ming vs. Sincere Navigation Corp | U Ming vs. Wan Hai Lines | U Ming vs. Yang Ming Marine | U Ming vs. Formosa Chemicals Fibre |
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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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