Correlation Between Matthews Asia and Matthews Asian
Can any of the company-specific risk be diversified away by investing in both Matthews Asia and Matthews Asian 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 Asia and Matthews Asian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Matthews Asia Growth and Matthews Asian Growth, you can compare the effects of market volatilities on Matthews Asia and Matthews Asian 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 Asia with a short position of Matthews Asian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Matthews Asia and Matthews Asian.
Diversification Opportunities for Matthews Asia and Matthews Asian
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Matthews and Matthews is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Matthews Asia Growth and Matthews Asian Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matthews Asian Growth and Matthews Asia 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 Asia Growth are associated (or correlated) with Matthews Asian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matthews Asian Growth has no effect on the direction of Matthews Asia i.e., Matthews Asia and Matthews Asian go up and down completely randomly.
Pair Corralation between Matthews Asia and Matthews Asian
Assuming the 90 days horizon Matthews Asia Growth is expected to under-perform the Matthews Asian. In addition to that, Matthews Asia is 1.37 times more volatile than Matthews Asian Growth. It trades about -0.09 of its total potential returns per unit of risk. Matthews Asian Growth is currently generating about -0.02 per unit of volatility. If you would invest 1,340 in Matthews Asian Growth on November 3, 2024 and sell it today you would lose (9.00) from holding Matthews Asian Growth or give up 0.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Matthews Asia Growth vs. Matthews Asian Growth
Performance |
| Timeline |
| Matthews Asia Growth |
| Matthews Asian Growth |
Matthews Asia and Matthews Asian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Matthews Asia and Matthews Asian
The main advantage of trading using opposite Matthews Asia and Matthews Asian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Matthews Asia position performs unexpectedly, Matthews Asian 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 Asian will offset losses from the drop in Matthews Asian's long position.| Matthews Asia vs. Matthews Asia Innovators | Matthews Asia vs. Matthews Japan Fund | Matthews Asia vs. Matthews Pacific Tiger | Matthews Asia vs. Matthews Asian Growth |
| Matthews Asian vs. Matthews Pacific Tiger | Matthews Asian vs. Matthews China Fund | Matthews Asian vs. Matthews Asia Dividend | Matthews Asian vs. Matthews Asia 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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