Correlation Between SOL IHS and MiraeAsset TIGER
Can any of the company-specific risk be diversified away by investing in both SOL IHS and MiraeAsset TIGER 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 SOL IHS and MiraeAsset TIGER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SOL IHS Markit and MiraeAsset TIGER China, you can compare the effects of market volatilities on SOL IHS and MiraeAsset TIGER 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 SOL IHS with a short position of MiraeAsset TIGER. Check out your portfolio center. Please also check ongoing floating volatility patterns of SOL IHS and MiraeAsset TIGER.
Diversification Opportunities for SOL IHS and MiraeAsset TIGER
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SOL and MiraeAsset is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding SOL IHS Markit and MiraeAsset TIGER China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MiraeAsset TIGER China and SOL IHS 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 SOL IHS Markit are associated (or correlated) with MiraeAsset TIGER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MiraeAsset TIGER China has no effect on the direction of SOL IHS i.e., SOL IHS and MiraeAsset TIGER go up and down completely randomly.
Pair Corralation between SOL IHS and MiraeAsset TIGER
Assuming the 90 days trading horizon SOL IHS is expected to generate 2.34 times less return on investment than MiraeAsset TIGER. But when comparing it to its historical volatility, SOL IHS Markit is 1.17 times less risky than MiraeAsset TIGER. It trades about 0.12 of its potential returns per unit of risk. MiraeAsset TIGER China is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 716,500 in MiraeAsset TIGER China on November 3, 2024 and sell it today you would earn a total of 68,000 from holding MiraeAsset TIGER China or generate 9.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SOL IHS Markit vs. MiraeAsset TIGER China
Performance |
| Timeline |
| SOL IHS Markit |
| MiraeAsset TIGER China |
SOL IHS and MiraeAsset TIGER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SOL IHS and MiraeAsset TIGER
The main advantage of trading using opposite SOL IHS and MiraeAsset TIGER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SOL IHS position performs unexpectedly, MiraeAsset TIGER 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 MiraeAsset TIGER will offset losses from the drop in MiraeAsset TIGER's long position.| SOL IHS vs. 453950 | SOL IHS vs. Busan Industrial Co | SOL IHS vs. Busan Ind | SOL IHS vs. Mirae Asset Daewoo |
| MiraeAsset TIGER vs. 453950 | MiraeAsset TIGER vs. Busan Industrial Co | MiraeAsset TIGER vs. Busan Ind | MiraeAsset TIGER vs. Mirae Asset Daewoo |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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