Correlation Between MI Technovation and British American
Can any of the company-specific risk be diversified away by investing in both MI Technovation and British American 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 British American 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 British American Tobacco, you can compare the effects of market volatilities on MI Technovation and British American 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 British American. Check out your portfolio center. Please also check ongoing floating volatility patterns of MI Technovation and British American.
Diversification Opportunities for MI Technovation and British American
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between 5286 and British is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding MI Technovation Bhd and British American Tobacco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on British American Tobacco 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 British American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of British American Tobacco has no effect on the direction of MI Technovation i.e., MI Technovation and British American go up and down completely randomly.
Pair Corralation between MI Technovation and British American
Assuming the 90 days trading horizon MI Technovation Bhd is expected to generate 1.14 times more return on investment than British American. However, MI Technovation is 1.14 times more volatile than British American Tobacco. It trades about 0.16 of its potential returns per unit of risk. British American Tobacco is currently generating about 0.15 per unit of risk. If you would invest 189.00 in MI Technovation Bhd on August 30, 2024 and sell it today you would earn a total of 20.00 from holding MI Technovation Bhd or generate 10.58% 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. British American Tobacco
Performance |
| Timeline |
| MI Technovation Bhd |
| British American Tobacco |
MI Technovation and British American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MI Technovation and British American
The main advantage of trading using opposite MI Technovation and British American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MI Technovation position performs unexpectedly, British American 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 British American will offset losses from the drop in British American's long position.| MI Technovation vs. Minetech Resources Bhd | MI Technovation vs. Sunzen Biotech Bhd | MI Technovation vs. Hengyuan Refining | MI Technovation vs. Impiana Hotels Bhd |
| British American vs. Alliance Financial Group | British American vs. MClean Technologies Bhd | British American vs. MyTech Group Bhd | British American vs. Supercomnet Technologies Bhd |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |