Correlation Between Min Aik and Giant Manufacturing
Can any of the company-specific risk be diversified away by investing in both Min Aik and Giant Manufacturing 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 Giant Manufacturing 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 Giant Manufacturing Co, you can compare the effects of market volatilities on Min Aik and Giant Manufacturing 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 Giant Manufacturing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Min Aik and Giant Manufacturing.
Diversification Opportunities for Min Aik and Giant Manufacturing
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Min and Giant is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Min Aik Technology and Giant Manufacturing Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Giant Manufacturing 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 Giant Manufacturing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Giant Manufacturing has no effect on the direction of Min Aik i.e., Min Aik and Giant Manufacturing go up and down completely randomly.
Pair Corralation between Min Aik and Giant Manufacturing
Assuming the 90 days trading horizon Min Aik Technology is expected to generate 1.34 times more return on investment than Giant Manufacturing. However, Min Aik is 1.34 times more volatile than Giant Manufacturing Co. It trades about 0.04 of its potential returns per unit of risk. Giant Manufacturing Co is currently generating about -0.03 per unit of risk. If you would invest 1,715 in Min Aik Technology on September 4, 2024 and sell it today you would earn a total of 635.00 from holding Min Aik Technology or generate 37.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.46% |
| Values | Daily Returns |
Min Aik Technology vs. Giant Manufacturing Co
Performance |
| Timeline |
| Min Aik Technology |
| Giant Manufacturing |
Min Aik and Giant Manufacturing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Min Aik and Giant Manufacturing
The main advantage of trading using opposite Min Aik and Giant Manufacturing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Min Aik position performs unexpectedly, Giant Manufacturing 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 Giant Manufacturing will offset losses from the drop in Giant Manufacturing's long position.| Min Aik vs. Taiwan Semiconductor Manufacturing | Min Aik vs. Yang Ming Marine | Min Aik vs. ASE Industrial Holding | Min Aik vs. AU Optronics |
| Giant Manufacturing vs. Merida Industry Co | Giant Manufacturing vs. President Chain Store | Giant Manufacturing vs. Cheng Shin Rubber | Giant Manufacturing vs. Uni President Enterprises Corp |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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