Correlation Between Maanshan Iron and Amkor Technology
Can any of the company-specific risk be diversified away by investing in both Maanshan Iron and Amkor 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 Maanshan Iron and Amkor Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maanshan Iron Steel and Amkor Technology, you can compare the effects of market volatilities on Maanshan Iron and Amkor 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 Maanshan Iron with a short position of Amkor Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maanshan Iron and Amkor Technology.
Diversification Opportunities for Maanshan Iron and Amkor Technology
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Maanshan and Amkor is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Maanshan Iron Steel and Amkor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amkor Technology and Maanshan Iron 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 Maanshan Iron Steel are associated (or correlated) with Amkor Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amkor Technology has no effect on the direction of Maanshan Iron i.e., Maanshan Iron and Amkor Technology go up and down completely randomly.
Pair Corralation between Maanshan Iron and Amkor Technology
Assuming the 90 days horizon Maanshan Iron Steel is expected to under-perform the Amkor Technology. In addition to that, Maanshan Iron is 1.47 times more volatile than Amkor Technology. It trades about -0.01 of its total potential returns per unit of risk. Amkor Technology is currently generating about 0.02 per unit of volatility. If you would invest 2,555 in Amkor Technology on September 1, 2024 and sell it today you would earn a total of 89.00 from holding Amkor Technology or generate 3.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maanshan Iron Steel vs. Amkor Technology
Performance |
| Timeline |
| Maanshan Iron Steel |
| Amkor Technology |
Maanshan Iron and Amkor Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maanshan Iron and Amkor Technology
The main advantage of trading using opposite Maanshan Iron and Amkor Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maanshan Iron position performs unexpectedly, Amkor 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 Amkor Technology will offset losses from the drop in Amkor Technology's long position.| Maanshan Iron vs. Olympic Steel | Maanshan Iron vs. POSCO Holdings | Maanshan Iron vs. Steel Dynamics | Maanshan Iron vs. Universal Stainless Alloy |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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