Correlation Between Ma Kuang and Syscom Computer
Can any of the company-specific risk be diversified away by investing in both Ma Kuang and Syscom Computer 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 Ma Kuang and Syscom Computer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ma Kuang Healthcare and Syscom Computer Engineering, you can compare the effects of market volatilities on Ma Kuang and Syscom Computer 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 Ma Kuang with a short position of Syscom Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ma Kuang and Syscom Computer.
Diversification Opportunities for Ma Kuang and Syscom Computer
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between 4139 and Syscom is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Ma Kuang Healthcare and Syscom Computer Engineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Syscom Computer Engi and Ma Kuang 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 Ma Kuang Healthcare are associated (or correlated) with Syscom Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Syscom Computer Engi has no effect on the direction of Ma Kuang i.e., Ma Kuang and Syscom Computer go up and down completely randomly.
Pair Corralation between Ma Kuang and Syscom Computer
Assuming the 90 days trading horizon Ma Kuang Healthcare is expected to under-perform the Syscom Computer. But the stock apears to be less risky and, when comparing its historical volatility, Ma Kuang Healthcare is 3.63 times less risky than Syscom Computer. The stock trades about -0.19 of its potential returns per unit of risk. The Syscom Computer Engineering is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 6,040 in Syscom Computer Engineering on November 28, 2024 and sell it today you would earn a total of 230.00 from holding Syscom Computer Engineering or generate 3.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ma Kuang Healthcare vs. Syscom Computer Engineering
Performance |
| Timeline |
| Ma Kuang Healthcare |
| Syscom Computer Engi |
Ma Kuang and Syscom Computer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ma Kuang and Syscom Computer
The main advantage of trading using opposite Ma Kuang and Syscom Computer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ma Kuang position performs unexpectedly, Syscom Computer 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 Syscom Computer will offset losses from the drop in Syscom Computer's long position.| Ma Kuang vs. TMP Steel | Ma Kuang vs. Tang Eng Iron | Ma Kuang vs. Tung Ho Steel | Ma Kuang vs. Nankang Rubber Tire |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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