Correlation Between Min Aik and HIM International
Can any of the company-specific risk be diversified away by investing in both Min Aik and HIM International 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 HIM International 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 HIM International Music, you can compare the effects of market volatilities on Min Aik and HIM International 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 HIM International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Min Aik and HIM International.
Diversification Opportunities for Min Aik and HIM International
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Min and HIM is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Min Aik Technology and HIM International Music in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HIM International Music 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 HIM International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HIM International Music has no effect on the direction of Min Aik i.e., Min Aik and HIM International go up and down completely randomly.
Pair Corralation between Min Aik and HIM International
Assuming the 90 days trading horizon Min Aik Technology is expected to generate 1.14 times more return on investment than HIM International. However, Min Aik is 1.14 times more volatile than HIM International Music. It trades about -0.07 of its potential returns per unit of risk. HIM International Music is currently generating about -0.15 per unit of risk. If you would invest 2,350 in Min Aik Technology on September 15, 2024 and sell it today you would lose (65.00) from holding Min Aik Technology or give up 2.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Min Aik Technology vs. HIM International Music
Performance |
| Timeline |
| Min Aik Technology |
| HIM International Music |
Min Aik and HIM International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Min Aik and HIM International
The main advantage of trading using opposite Min Aik and HIM International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Min Aik position performs unexpectedly, HIM International 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 HIM International will offset losses from the drop in HIM International's long position.| Min Aik vs. AU Optronics | Min Aik vs. Innolux Corp | Min Aik vs. Ruentex Development Co | Min Aik vs. WiseChip Semiconductor |
| HIM International vs. Simplo Technology Co | HIM International vs. Sitronix Technology Corp | HIM International vs. Grand Ocean Retail | HIM International vs. Min Aik 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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