Correlation Between MI Technovation and CB Industrial
Can any of the company-specific risk be diversified away by investing in both MI Technovation and CB Industrial 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 CB Industrial 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 CB Industrial Product, you can compare the effects of market volatilities on MI Technovation and CB Industrial 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 CB Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of MI Technovation and CB Industrial.
Diversification Opportunities for MI Technovation and CB Industrial
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 5286 and 7076 is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding MI Technovation Bhd and CB Industrial Product in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CB Industrial Product 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 CB Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CB Industrial Product has no effect on the direction of MI Technovation i.e., MI Technovation and CB Industrial go up and down completely randomly.
Pair Corralation between MI Technovation and CB Industrial
Assuming the 90 days trading horizon MI Technovation Bhd is expected to generate 1.43 times more return on investment than CB Industrial. However, MI Technovation is 1.43 times more volatile than CB Industrial Product. It trades about 0.07 of its potential returns per unit of risk. CB Industrial Product is currently generating about 0.0 per unit of risk. If you would invest 185.00 in MI Technovation Bhd on November 3, 2024 and sell it today you would earn a total of 35.00 from holding MI Technovation Bhd or generate 18.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MI Technovation Bhd vs. CB Industrial Product
Performance |
| Timeline |
| MI Technovation Bhd |
| CB Industrial Product |
MI Technovation and CB Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MI Technovation and CB Industrial
The main advantage of trading using opposite MI Technovation and CB Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MI Technovation position performs unexpectedly, CB Industrial 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 CB Industrial will offset losses from the drop in CB Industrial's long position.| MI Technovation vs. Aurelius Technologies Bhd | MI Technovation vs. Kobay Tech Bhd | MI Technovation vs. Radiant Globaltech Bhd | MI Technovation vs. Minetech Resources Bhd |
| CB Industrial vs. KPJ Healthcare Bhd | CB Industrial vs. DC HEALTHCARE HOLDINGS | CB Industrial vs. CPE Technology Berhad | CB Industrial vs. Aeon Credit Service |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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