Correlation Between Duopharma Biotech and Magni Tech
Can any of the company-specific risk be diversified away by investing in both Duopharma Biotech and Magni Tech 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 Duopharma Biotech and Magni Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Duopharma Biotech Bhd and Magni Tech Industries, you can compare the effects of market volatilities on Duopharma Biotech and Magni Tech 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 Duopharma Biotech with a short position of Magni Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duopharma Biotech and Magni Tech.
Diversification Opportunities for Duopharma Biotech and Magni Tech
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Duopharma and Magni is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Duopharma Biotech Bhd and Magni Tech Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magni Tech Industries and Duopharma Biotech 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 Duopharma Biotech Bhd are associated (or correlated) with Magni Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magni Tech Industries has no effect on the direction of Duopharma Biotech i.e., Duopharma Biotech and Magni Tech go up and down completely randomly.
Pair Corralation between Duopharma Biotech and Magni Tech
Assuming the 90 days trading horizon Duopharma Biotech Bhd is expected to under-perform the Magni Tech. In addition to that, Duopharma Biotech is 1.15 times more volatile than Magni Tech Industries. It trades about -0.13 of its total potential returns per unit of risk. Magni Tech Industries is currently generating about 0.51 per unit of volatility. If you would invest 243.00 in Magni Tech Industries on September 1, 2024 and sell it today you would earn a total of 27.00 from holding Magni Tech Industries or generate 11.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Duopharma Biotech Bhd vs. Magni Tech Industries
Performance |
| Timeline |
| Duopharma Biotech Bhd |
| Magni Tech Industries |
Duopharma Biotech and Magni Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Duopharma Biotech and Magni Tech
The main advantage of trading using opposite Duopharma Biotech and Magni Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duopharma Biotech position performs unexpectedly, Magni Tech 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 Magni Tech will offset losses from the drop in Magni Tech's long position.| Duopharma Biotech vs. Digistar Bhd | Duopharma Biotech vs. Minetech Resources Bhd | Duopharma Biotech vs. Swift Haulage Bhd | Duopharma Biotech vs. Bina Darulaman Bhd |
| Magni Tech vs. YX Precious Metals | Magni Tech vs. SSF Home Group | Magni Tech vs. Mycron Steel Bhd | Magni Tech vs. Malaysia Steel Works |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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