Correlation Between Ras Technology and MA Financial
Can any of the company-specific risk be diversified away by investing in both Ras Technology and MA Financial 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 Ras Technology and MA Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ras Technology Holdings and MA Financial Group, you can compare the effects of market volatilities on Ras Technology and MA Financial 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 Ras Technology with a short position of MA Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ras Technology and MA Financial.
Diversification Opportunities for Ras Technology and MA Financial
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ras and MAF is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Ras Technology Holdings and MA Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MA Financial Group and Ras Technology 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 Ras Technology Holdings are associated (or correlated) with MA Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MA Financial Group has no effect on the direction of Ras Technology i.e., Ras Technology and MA Financial go up and down completely randomly.
Pair Corralation between Ras Technology and MA Financial
Assuming the 90 days trading horizon Ras Technology Holdings is expected to under-perform the MA Financial. In addition to that, Ras Technology is 1.95 times more volatile than MA Financial Group. It trades about -0.26 of its total potential returns per unit of risk. MA Financial Group is currently generating about -0.1 per unit of volatility. If you would invest 642.00 in MA Financial Group on September 19, 2024 and sell it today you would lose (54.00) from holding MA Financial Group or give up 8.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ras Technology Holdings vs. MA Financial Group
Performance |
| Timeline |
| Ras Technology Holdings |
| MA Financial Group |
Ras Technology and MA Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ras Technology and MA Financial
The main advantage of trading using opposite Ras Technology and MA Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ras Technology position performs unexpectedly, MA Financial 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 MA Financial will offset losses from the drop in MA Financial's long position.| Ras Technology vs. Truscott Mining Corp | Ras Technology vs. Iron Road | Ras Technology vs. Tombador Iron | Ras Technology vs. Hutchison Telecommunications |
| MA Financial vs. Ras Technology Holdings | MA Financial vs. DY6 Metals | MA Financial vs. G8 Education | MA Financial vs. Janison Education Group |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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