Correlation Between MFEC PCL and Hana Microelectronics
Can any of the company-specific risk be diversified away by investing in both MFEC PCL and Hana Microelectronics 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 MFEC PCL and Hana Microelectronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MFEC PCL and Hana Microelectronics Public, you can compare the effects of market volatilities on MFEC PCL and Hana Microelectronics 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 MFEC PCL with a short position of Hana Microelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFEC PCL and Hana Microelectronics.
Diversification Opportunities for MFEC PCL and Hana Microelectronics
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between MFEC and Hana is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding MFEC PCL and Hana Microelectronics Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hana Microelectronics and MFEC PCL 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 MFEC PCL are associated (or correlated) with Hana Microelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hana Microelectronics has no effect on the direction of MFEC PCL i.e., MFEC PCL and Hana Microelectronics go up and down completely randomly.
Pair Corralation between MFEC PCL and Hana Microelectronics
Assuming the 90 days trading horizon MFEC PCL is expected to generate 0.35 times more return on investment than Hana Microelectronics. However, MFEC PCL is 2.87 times less risky than Hana Microelectronics. It trades about 0.03 of its potential returns per unit of risk. Hana Microelectronics Public is currently generating about -0.32 per unit of risk. If you would invest 610.00 in MFEC PCL on August 28, 2024 and sell it today you would earn a total of 5.00 from holding MFEC PCL or generate 0.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MFEC PCL vs. Hana Microelectronics Public
Performance |
| Timeline |
| MFEC PCL |
| Hana Microelectronics |
MFEC PCL and Hana Microelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFEC PCL and Hana Microelectronics
The main advantage of trading using opposite MFEC PCL and Hana Microelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFEC PCL position performs unexpectedly, Hana Microelectronics 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 Hana Microelectronics will offset losses from the drop in Hana Microelectronics' long position.| MFEC PCL vs. AP Public | MFEC PCL vs. Jasmine International Public | MFEC PCL vs. Asia Plus Group | MFEC PCL vs. Bangkok Aviation Fuel |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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