Correlation Between Top Material and MEDIPOST
Can any of the company-specific risk be diversified away by investing in both Top Material and MEDIPOST 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 Top Material and MEDIPOST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Top Material Co and MEDIPOST Co, you can compare the effects of market volatilities on Top Material and MEDIPOST 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 Top Material with a short position of MEDIPOST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Top Material and MEDIPOST.
Diversification Opportunities for Top Material and MEDIPOST
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Top and MEDIPOST is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Top Material Co and MEDIPOST Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MEDIPOST and Top Material 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 Top Material Co are associated (or correlated) with MEDIPOST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MEDIPOST has no effect on the direction of Top Material i.e., Top Material and MEDIPOST go up and down completely randomly.
Pair Corralation between Top Material and MEDIPOST
Assuming the 90 days trading horizon Top Material Co is expected to under-perform the MEDIPOST. But the stock apears to be less risky and, when comparing its historical volatility, Top Material Co is 1.68 times less risky than MEDIPOST. The stock trades about -0.31 of its potential returns per unit of risk. The MEDIPOST Co is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest 1,205,000 in MEDIPOST Co on November 6, 2024 and sell it today you would lose (85,000) from holding MEDIPOST Co or give up 7.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Top Material Co vs. MEDIPOST Co
Performance |
| Timeline |
| Top Material |
| MEDIPOST |
Top Material and MEDIPOST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Top Material and MEDIPOST
The main advantage of trading using opposite Top Material and MEDIPOST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Top Material position performs unexpectedly, MEDIPOST 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 MEDIPOST will offset losses from the drop in MEDIPOST's long position.| Top Material vs. Hyundai BNG Steel | Top Material vs. Insun Environment New | Top Material vs. Moonbae Steel | Top Material vs. Han Kook Steel |
| MEDIPOST vs. Daishin Information Communications | MEDIPOST vs. Ssangyong Information Communication | MEDIPOST vs. Echomarketing CoLtd | MEDIPOST vs. Kisan Telecom Co |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |