Correlation Between Minetech Resources and JF Technology
Can any of the company-specific risk be diversified away by investing in both Minetech Resources and JF Technology 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 Minetech Resources and JF Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Minetech Resources Bhd and JF Technology BHD, you can compare the effects of market volatilities on Minetech Resources and JF Technology 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 Minetech Resources with a short position of JF Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Minetech Resources and JF Technology.
Diversification Opportunities for Minetech Resources and JF Technology
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Minetech and 0146 is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Minetech Resources Bhd and JF Technology BHD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JF Technology BHD and Minetech Resources 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 Minetech Resources Bhd are associated (or correlated) with JF Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JF Technology BHD has no effect on the direction of Minetech Resources i.e., Minetech Resources and JF Technology go up and down completely randomly.
Pair Corralation between Minetech Resources and JF Technology
Assuming the 90 days trading horizon Minetech Resources Bhd is expected to under-perform the JF Technology. In addition to that, Minetech Resources is 3.44 times more volatile than JF Technology BHD. It trades about -0.24 of its total potential returns per unit of risk. JF Technology BHD is currently generating about -0.48 per unit of volatility. If you would invest 68.00 in JF Technology BHD on November 27, 2024 and sell it today you would lose (11.00) from holding JF Technology BHD or give up 16.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Minetech Resources Bhd vs. JF Technology BHD
Performance |
| Timeline |
| Minetech Resources Bhd |
| JF Technology BHD |
Minetech Resources and JF Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Minetech Resources and JF Technology
The main advantage of trading using opposite Minetech Resources and JF Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Minetech Resources position performs unexpectedly, JF Technology 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 JF Technology will offset losses from the drop in JF Technology's long position.| Minetech Resources vs. EA Technique M | Minetech Resources vs. Saudee Group Bhd | Minetech Resources vs. Digistar Bhd | Minetech Resources vs. AirAsia X Bhd |
| JF Technology vs. Central Industrial Corp | JF Technology vs. Public Bank Bhd | JF Technology vs. Binasat Communications Bhd | JF Technology 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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