Correlation Between MI Technovation and Hengyuan Refining
Can any of the company-specific risk be diversified away by investing in both MI Technovation and Hengyuan Refining 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 Hengyuan Refining 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 Hengyuan Refining, you can compare the effects of market volatilities on MI Technovation and Hengyuan Refining 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 Hengyuan Refining. Check out your portfolio center. Please also check ongoing floating volatility patterns of MI Technovation and Hengyuan Refining.
Diversification Opportunities for MI Technovation and Hengyuan Refining
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between 5286 and Hengyuan is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding MI Technovation Bhd and Hengyuan Refining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hengyuan Refining 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 Hengyuan Refining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hengyuan Refining has no effect on the direction of MI Technovation i.e., MI Technovation and Hengyuan Refining go up and down completely randomly.
Pair Corralation between MI Technovation and Hengyuan Refining
Assuming the 90 days trading horizon MI Technovation Bhd is expected to under-perform the Hengyuan Refining. In addition to that, MI Technovation is 1.83 times more volatile than Hengyuan Refining. It trades about -0.28 of its total potential returns per unit of risk. Hengyuan Refining is currently generating about -0.31 per unit of volatility. If you would invest 199.00 in Hengyuan Refining on November 28, 2024 and sell it today you would lose (15.00) from holding Hengyuan Refining or give up 7.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
MI Technovation Bhd vs. Hengyuan Refining
Performance |
| Timeline |
| MI Technovation Bhd |
| Hengyuan Refining |
MI Technovation and Hengyuan Refining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MI Technovation and Hengyuan Refining
The main advantage of trading using opposite MI Technovation and Hengyuan Refining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MI Technovation position performs unexpectedly, Hengyuan Refining 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 Hengyuan Refining will offset losses from the drop in Hengyuan Refining's long position.| MI Technovation vs. Press Metal Bhd | MI Technovation vs. Choo Bee Metal | MI Technovation vs. Datasonic Group Bhd | MI Technovation vs. Leader Steel Holdings |
| Hengyuan Refining vs. Lyc Healthcare Bhd | Hengyuan Refining vs. Mercury Industries Bhd | Hengyuan Refining vs. RHB Bank Bhd | Hengyuan Refining vs. YX Precious Metals |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |