Correlation Between Merida Industry and Advantech
Can any of the company-specific risk be diversified away by investing in both Merida Industry and Advantech 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 Merida Industry and Advantech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Merida Industry Co and Advantech Co, you can compare the effects of market volatilities on Merida Industry and Advantech 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 Merida Industry with a short position of Advantech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merida Industry and Advantech.
Diversification Opportunities for Merida Industry and Advantech
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Merida and Advantech is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Merida Industry Co and Advantech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advantech and Merida Industry 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 Merida Industry Co are associated (or correlated) with Advantech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advantech has no effect on the direction of Merida Industry i.e., Merida Industry and Advantech go up and down completely randomly.
Pair Corralation between Merida Industry and Advantech
Assuming the 90 days trading horizon Merida Industry Co is expected to under-perform the Advantech. In addition to that, Merida Industry is 1.52 times more volatile than Advantech Co. It trades about -0.01 of its total potential returns per unit of risk. Advantech Co is currently generating about 0.0 per unit of volatility. If you would invest 35,150 in Advantech Co on September 2, 2024 and sell it today you would lose (1,600) from holding Advantech Co or give up 4.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Merida Industry Co vs. Advantech Co
Performance |
| Timeline |
| Merida Industry |
| Advantech |
Merida Industry and Advantech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merida Industry and Advantech
The main advantage of trading using opposite Merida Industry and Advantech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merida Industry position performs unexpectedly, Advantech 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 Advantech will offset losses from the drop in Advantech's long position.| Merida Industry vs. Giant Manufacturing Co | Merida Industry vs. Cheng Shin Rubber | Merida Industry vs. Feng Tay Enterprises | Merida Industry vs. President Chain Store |
| Advantech vs. Delta Electronics | Advantech vs. Quanta Computer | Advantech vs. Realtek Semiconductor Corp | Advantech vs. President Chain Store |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |