Correlation Between Matthews Asian and Matthews Asia
Can any of the company-specific risk be diversified away by investing in both Matthews Asian and Matthews Asia 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 Matthews Asian and Matthews Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Matthews Asian Growth and Matthews Asia Dividend, you can compare the effects of market volatilities on Matthews Asian and Matthews Asia 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 Matthews Asian with a short position of Matthews Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Matthews Asian and Matthews Asia.
Diversification Opportunities for Matthews Asian and Matthews Asia
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Matthews and Matthews is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Matthews Asian Growth and Matthews Asia Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matthews Asia Dividend and Matthews Asian 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 Matthews Asian Growth are associated (or correlated) with Matthews Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matthews Asia Dividend has no effect on the direction of Matthews Asian i.e., Matthews Asian and Matthews Asia go up and down completely randomly.
Pair Corralation between Matthews Asian and Matthews Asia
Assuming the 90 days horizon Matthews Asian Growth is expected to under-perform the Matthews Asia. In addition to that, Matthews Asian is 1.07 times more volatile than Matthews Asia Dividend. It trades about -0.19 of its total potential returns per unit of risk. Matthews Asia Dividend is currently generating about -0.17 per unit of volatility. If you would invest 1,492 in Matthews Asia Dividend on August 25, 2024 and sell it today you would lose (42.00) from holding Matthews Asia Dividend or give up 2.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Matthews Asian Growth vs. Matthews Asia Dividend
Performance |
| Timeline |
| Matthews Asian Growth |
| Matthews Asia Dividend |
Matthews Asian and Matthews Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Matthews Asian and Matthews Asia
The main advantage of trading using opposite Matthews Asian and Matthews Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Matthews Asian position performs unexpectedly, Matthews Asia 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 Matthews Asia will offset losses from the drop in Matthews Asia's long position.| Matthews Asian vs. Matthews Asia Dividend | Matthews Asian vs. Wcm Focused International | Matthews Asian vs. Invesco Disciplined Equity | Matthews Asian vs. Small Cap Equity |
| Matthews Asia vs. Matthews Asia Innovators | Matthews Asia vs. Matthews Japan Fund | Matthews Asia vs. Matthews Pacific Tiger | Matthews Asia vs. Matthews Asian Growth |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |