Correlation Between Min Aik and Associated Industries
Can any of the company-specific risk be diversified away by investing in both Min Aik and Associated Industries 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 Associated Industries 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 Associated Industries China, you can compare the effects of market volatilities on Min Aik and Associated Industries 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 Associated Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Min Aik and Associated Industries.
Diversification Opportunities for Min Aik and Associated Industries
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Min and Associated is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Min Aik Technology and Associated Industries China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Associated Industries 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 Associated Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Associated Industries has no effect on the direction of Min Aik i.e., Min Aik and Associated Industries go up and down completely randomly.
Pair Corralation between Min Aik and Associated Industries
Assuming the 90 days trading horizon Min Aik Technology is expected to under-perform the Associated Industries. In addition to that, Min Aik is 1.96 times more volatile than Associated Industries China. It trades about -0.09 of its total potential returns per unit of risk. Associated Industries China is currently generating about -0.11 per unit of volatility. If you would invest 1,330 in Associated Industries China on August 30, 2024 and sell it today you would lose (115.00) from holding Associated Industries China or give up 8.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Min Aik Technology vs. Associated Industries China
Performance |
| Timeline |
| Min Aik Technology |
| Associated Industries |
Min Aik and Associated Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Min Aik and Associated Industries
The main advantage of trading using opposite Min Aik and Associated Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Min Aik position performs unexpectedly, Associated Industries 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 Associated Industries will offset losses from the drop in Associated Industries' long position.| Min Aik vs. Promise Technology | Min Aik vs. Spirox Corp | Min Aik vs. Zinwell | Min Aik vs. Gigastorage Corp |
| Associated Industries vs. In Win Development | Associated Industries vs. Chenming Mold Industrial | Associated Industries vs. Min Aik Technology | Associated Industries vs. Promise 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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