Correlation Between MI Technovation and Cengild Medical
Can any of the company-specific risk be diversified away by investing in both MI Technovation and Cengild Medical 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 MI Technovation and Cengild Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MI Technovation Bhd and Cengild Medical Berhad, you can compare the effects of market volatilities on MI Technovation and Cengild Medical 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 MI Technovation with a short position of Cengild Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of MI Technovation and Cengild Medical.
Diversification Opportunities for MI Technovation and Cengild Medical
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between 5286 and Cengild is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding MI Technovation Bhd and Cengild Medical Berhad in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cengild Medical Berhad and MI Technovation 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 MI Technovation Bhd are associated (or correlated) with Cengild Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cengild Medical Berhad has no effect on the direction of MI Technovation i.e., MI Technovation and Cengild Medical go up and down completely randomly.
Pair Corralation between MI Technovation and Cengild Medical
Assuming the 90 days trading horizon MI Technovation Bhd is expected to generate 1.18 times more return on investment than Cengild Medical. However, MI Technovation is 1.18 times more volatile than Cengild Medical Berhad. It trades about 0.04 of its potential returns per unit of risk. Cengild Medical Berhad is currently generating about -0.03 per unit of risk. If you would invest 138.00 in MI Technovation Bhd on September 2, 2024 and sell it today you would earn a total of 72.00 from holding MI Technovation Bhd or generate 52.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MI Technovation Bhd vs. Cengild Medical Berhad
Performance |
| Timeline |
| MI Technovation Bhd |
| Cengild Medical Berhad |
MI Technovation and Cengild Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MI Technovation and Cengild Medical
The main advantage of trading using opposite MI Technovation and Cengild Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MI Technovation position performs unexpectedly, Cengild Medical 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 Cengild Medical will offset losses from the drop in Cengild Medical's long position.| MI Technovation vs. Computer Forms Bhd | MI Technovation vs. Senheng New Retail | MI Technovation vs. YX Precious Metals | MI Technovation vs. Diversified Gateway Solutions |
| Cengild Medical vs. Oriental Food Industries | Cengild Medical vs. Melewar Industrial Group | Cengild Medical vs. Dataprep Holdings Bhd | Cengild Medical vs. FARM FRESH BERHAD |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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