Correlation Between Min Aik and New Advanced

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Min Aik and New Advanced 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 Min Aik and New Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Min Aik Technology and New Advanced Electronics, you can compare the effects of market volatilities on Min Aik and New Advanced 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 Min Aik with a short position of New Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Min Aik and New Advanced.

Diversification Opportunities for Min Aik and New Advanced

0.51
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Min and New is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Min Aik Technology and New Advanced Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Advanced Electronics and Min Aik 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 Min Aik Technology are associated (or correlated) with New Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Advanced Electronics has no effect on the direction of Min Aik i.e., Min Aik and New Advanced go up and down completely randomly.

Pair Corralation between Min Aik and New Advanced

Assuming the 90 days trading horizon Min Aik Technology is expected to generate 1.54 times more return on investment than New Advanced. However, Min Aik is 1.54 times more volatile than New Advanced Electronics. It trades about -0.08 of its potential returns per unit of risk. New Advanced Electronics is currently generating about -0.24 per unit of risk. If you would invest  2,700  in Min Aik Technology on September 2, 2024 and sell it today you would lose (350.00) from holding Min Aik Technology or give up 12.96% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Min Aik Technology  vs.  New Advanced Electronics

 Performance 
       Timeline  
Min Aik Technology 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Min Aik Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.
New Advanced Electronics 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days New Advanced Electronics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Min Aik and New Advanced Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Min Aik and New Advanced

The main advantage of trading using opposite Min Aik and New Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Min Aik position performs unexpectedly, New Advanced 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 New Advanced will offset losses from the drop in New Advanced's long position.
The idea behind Min Aik Technology and New Advanced Electronics pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.

Other Complementary Tools

Commodity Directory
Find actively traded commodities issued by global exchanges
Portfolio Backtesting
Avoid under-diversification and over-optimization by backtesting your portfolios
Earnings Calls
Check upcoming earnings announcements updated hourly across public exchanges
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios