Correlation Between Barnes and Ming Shing
Can any of the company-specific risk be diversified away by investing in both Barnes and Ming Shing 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 Barnes and Ming Shing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barnes Group and Ming Shing Group, you can compare the effects of market volatilities on Barnes and Ming Shing 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 Barnes with a short position of Ming Shing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barnes and Ming Shing.
Diversification Opportunities for Barnes and Ming Shing
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Barnes and Ming is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Barnes Group and Ming Shing Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ming Shing Group and Barnes 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 Barnes Group are associated (or correlated) with Ming Shing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ming Shing Group has no effect on the direction of Barnes i.e., Barnes and Ming Shing go up and down completely randomly.
Pair Corralation between Barnes and Ming Shing
Taking into account the 90-day investment horizon Barnes is expected to generate 113.7 times less return on investment than Ming Shing. But when comparing it to its historical volatility, Barnes Group is 183.26 times less risky than Ming Shing. It trades about 0.23 of its potential returns per unit of risk. Ming Shing Group is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 584.00 in Ming Shing Group on October 15, 2024 and sell it today you would earn a total of 135.00 from holding Ming Shing Group or generate 23.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Barnes Group vs. Ming Shing Group
Performance |
| Timeline |
| Barnes Group |
| Ming Shing Group |
Barnes and Ming Shing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barnes and Ming Shing
The main advantage of trading using opposite Barnes and Ming Shing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barnes position performs unexpectedly, Ming Shing 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 Ming Shing will offset losses from the drop in Ming Shing's long position.| Barnes vs. Helios Technologies | Barnes vs. Enpro Industries | Barnes vs. Omega Flex | Barnes vs. Luxfer Holdings PLC |
| Ming Shing vs. Kulicke and Soffa | Ming Shing vs. Arm Holdings plc | Ming Shing vs. Diageo PLC ADR | Ming Shing vs. FormFactor |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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