Correlation Between Microelectronics and Mega Financial
Can any of the company-specific risk be diversified away by investing in both Microelectronics and Mega Financial 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 Microelectronics and Mega Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microelectronics Technology and Mega Financial Holding, you can compare the effects of market volatilities on Microelectronics and Mega Financial 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 Microelectronics with a short position of Mega Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microelectronics and Mega Financial.
Diversification Opportunities for Microelectronics and Mega Financial
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Microelectronics and Mega is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Microelectronics Technology and Mega Financial Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mega Financial Holding and Microelectronics 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 Microelectronics Technology are associated (or correlated) with Mega Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mega Financial Holding has no effect on the direction of Microelectronics i.e., Microelectronics and Mega Financial go up and down completely randomly.
Pair Corralation between Microelectronics and Mega Financial
Assuming the 90 days trading horizon Microelectronics Technology is expected to under-perform the Mega Financial. In addition to that, Microelectronics is 5.24 times more volatile than Mega Financial Holding. It trades about -0.07 of its total potential returns per unit of risk. Mega Financial Holding is currently generating about -0.07 per unit of volatility. If you would invest 3,910 in Mega Financial Holding on October 25, 2024 and sell it today you would lose (40.00) from holding Mega Financial Holding or give up 1.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microelectronics Technology vs. Mega Financial Holding
Performance |
| Timeline |
| Microelectronics Tec |
| Mega Financial Holding |
Microelectronics and Mega Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microelectronics and Mega Financial
The main advantage of trading using opposite Microelectronics and Mega Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microelectronics position performs unexpectedly, Mega Financial 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 Mega Financial will offset losses from the drop in Mega Financial's long position.| Microelectronics vs. Unimicron Technology Corp | Microelectronics vs. Kinsus Interconnect Technology | Microelectronics vs. Novatek Microelectronics Corp | Microelectronics vs. Delta Electronics |
| Mega Financial vs. CTBC Financial Holding | Mega Financial vs. Fubon Financial Holding | Mega Financial vs. First Financial Holding | Mega Financial vs. Cathay Financial Holding |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |