Correlation Between Ming Le and AIR PRODCHEMICALS
Can any of the company-specific risk be diversified away by investing in both Ming Le and AIR PRODCHEMICALS 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 AIR PRODCHEMICALS 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 AIR PRODCHEMICALS, you can compare the effects of market volatilities on Ming Le and AIR PRODCHEMICALS 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 AIR PRODCHEMICALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ming Le and AIR PRODCHEMICALS.
Diversification Opportunities for Ming Le and AIR PRODCHEMICALS
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ming and AIR is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Ming Le Sports and AIR PRODCHEMICALS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIR PRODCHEMICALS 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 AIR PRODCHEMICALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIR PRODCHEMICALS has no effect on the direction of Ming Le i.e., Ming Le and AIR PRODCHEMICALS go up and down completely randomly.
Pair Corralation between Ming Le and AIR PRODCHEMICALS
Assuming the 90 days trading horizon Ming Le Sports is expected to under-perform the AIR PRODCHEMICALS. In addition to that, Ming Le is 1.57 times more volatile than AIR PRODCHEMICALS. It trades about -0.01 of its total potential returns per unit of risk. AIR PRODCHEMICALS is currently generating about 0.01 per unit of volatility. If you would invest 24,838 in AIR PRODCHEMICALS on January 7, 2025 and sell it today you would earn a total of 712.00 from holding AIR PRODCHEMICALS or generate 2.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ming Le Sports vs. AIR PRODCHEMICALS
Performance |
| Timeline |
| Ming Le Sports |
| AIR PRODCHEMICALS |
Ming Le and AIR PRODCHEMICALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ming Le and AIR PRODCHEMICALS
The main advantage of trading using opposite Ming Le and AIR PRODCHEMICALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ming Le position performs unexpectedly, AIR PRODCHEMICALS 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 AIR PRODCHEMICALS will offset losses from the drop in AIR PRODCHEMICALS's long position.| Ming Le vs. PT Steel Pipe | Ming Le vs. SCOTT TECHNOLOGY | Ming Le vs. Nippon Steel | Ming Le vs. Tianjin Capital Environmental |
| AIR PRODCHEMICALS vs. INTER CARS SA | AIR PRODCHEMICALS vs. CLEAN ENERGY FUELS | AIR PRODCHEMICALS vs. Nomad Foods | AIR PRODCHEMICALS vs. High Liner Foods |
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.
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