Correlation Between Mega Lifesciences and Chiangmai Frozen
Can any of the company-specific risk be diversified away by investing in both Mega Lifesciences and Chiangmai Frozen 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 Mega Lifesciences and Chiangmai Frozen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mega Lifesciences Public and Chiangmai Frozen Foods, you can compare the effects of market volatilities on Mega Lifesciences and Chiangmai Frozen 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 Mega Lifesciences with a short position of Chiangmai Frozen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mega Lifesciences and Chiangmai Frozen.
Diversification Opportunities for Mega Lifesciences and Chiangmai Frozen
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Mega and Chiangmai is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Mega Lifesciences Public and Chiangmai Frozen Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chiangmai Frozen Foods and Mega Lifesciences 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 Mega Lifesciences Public are associated (or correlated) with Chiangmai Frozen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chiangmai Frozen Foods has no effect on the direction of Mega Lifesciences i.e., Mega Lifesciences and Chiangmai Frozen go up and down completely randomly.
Pair Corralation between Mega Lifesciences and Chiangmai Frozen
Assuming the 90 days trading horizon Mega Lifesciences Public is expected to under-perform the Chiangmai Frozen. But the stock apears to be less risky and, when comparing its historical volatility, Mega Lifesciences Public is 28.75 times less risky than Chiangmai Frozen. The stock trades about -0.03 of its potential returns per unit of risk. The Chiangmai Frozen Foods is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 252.00 in Chiangmai Frozen Foods on September 2, 2024 and sell it today you would lose (50.00) from holding Chiangmai Frozen Foods or give up 19.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mega Lifesciences Public vs. Chiangmai Frozen Foods
Performance |
| Timeline |
| Mega Lifesciences Public |
| Chiangmai Frozen Foods |
Mega Lifesciences and Chiangmai Frozen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mega Lifesciences and Chiangmai Frozen
The main advantage of trading using opposite Mega Lifesciences and Chiangmai Frozen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mega Lifesciences position performs unexpectedly, Chiangmai Frozen 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 Chiangmai Frozen will offset losses from the drop in Chiangmai Frozen's long position.| Mega Lifesciences vs. AP Public | Mega Lifesciences vs. Advanced Information Technology | Mega Lifesciences vs. AJ Plast Public | Mega Lifesciences vs. Berli Jucker Public |
| Chiangmai Frozen vs. MK Restaurant Group | Chiangmai Frozen vs. TRC Construction Public | Chiangmai Frozen vs. Bangkok Expressway and | Chiangmai Frozen vs. Lohakit Metal Public |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |