Correlation Between Ming Le and Honeywell International
Can any of the company-specific risk be diversified away by investing in both Ming Le and Honeywell International 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 Ming Le and Honeywell International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ming Le Sports and Honeywell International, you can compare the effects of market volatilities on Ming Le and Honeywell International 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 Ming Le with a short position of Honeywell International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ming Le and Honeywell International.
Diversification Opportunities for Ming Le and Honeywell International
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ming and Honeywell is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Ming Le Sports and Honeywell International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Honeywell International and Ming Le 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 Ming Le Sports are associated (or correlated) with Honeywell International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Honeywell International has no effect on the direction of Ming Le i.e., Ming Le and Honeywell International go up and down completely randomly.
Pair Corralation between Ming Le and Honeywell International
Assuming the 90 days trading horizon Ming Le Sports is expected to generate 2.34 times more return on investment than Honeywell International. However, Ming Le is 2.34 times more volatile than Honeywell International. It trades about 0.08 of its potential returns per unit of risk. Honeywell International is currently generating about -0.11 per unit of risk. If you would invest 119.00 in Ming Le Sports on November 30, 2024 and sell it today you would earn a total of 12.00 from holding Ming Le Sports or generate 10.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ming Le Sports vs. Honeywell International
Performance |
| Timeline |
| Ming Le Sports |
| Honeywell International |
Ming Le and Honeywell International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ming Le and Honeywell International
The main advantage of trading using opposite Ming Le and Honeywell International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ming Le position performs unexpectedly, Honeywell International 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 Honeywell International will offset losses from the drop in Honeywell International's long position.| Ming Le vs. KAUFMAN ET BROAD | Ming Le vs. ZhongAn Online P | Ming Le vs. Gruppo Mutuionline SpA | Ming Le vs. Air Transport Services |
| Honeywell International vs. NEWELL RUBBERMAID | Honeywell International vs. GEAR4MUSIC LS 10 | Honeywell International vs. CVW CLEANTECH INC | Honeywell International vs. The Yokohama Rubber |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |