Correlation Between Stock Exchange and Mega Lifesciences
Can any of the company-specific risk be diversified away by investing in both Stock Exchange and Mega Lifesciences 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 Stock Exchange and Mega Lifesciences into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stock Exchange Of and Mega Lifesciences Public, you can compare the effects of market volatilities on Stock Exchange and Mega Lifesciences 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 Stock Exchange with a short position of Mega Lifesciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stock Exchange and Mega Lifesciences.
Diversification Opportunities for Stock Exchange and Mega Lifesciences
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Stock and Mega is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Stock Exchange Of and Mega Lifesciences Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mega Lifesciences Public and Stock Exchange 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 Stock Exchange Of are associated (or correlated) with Mega Lifesciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mega Lifesciences Public has no effect on the direction of Stock Exchange i.e., Stock Exchange and Mega Lifesciences go up and down completely randomly.
Pair Corralation between Stock Exchange and Mega Lifesciences
Assuming the 90 days trading horizon Stock Exchange Of is expected to generate 0.4 times more return on investment than Mega Lifesciences. However, Stock Exchange Of is 2.51 times less risky than Mega Lifesciences. It trades about -0.07 of its potential returns per unit of risk. Mega Lifesciences Public is currently generating about -0.31 per unit of risk. If you would invest 145,303 in Stock Exchange Of on August 28, 2024 and sell it today you would lose (1,478) from holding Stock Exchange Of or give up 1.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stock Exchange Of vs. Mega Lifesciences Public
Performance |
| Timeline |
Stock Exchange and Mega Lifesciences Volatility Contrast
Predicted Return Density |
| Returns |
Stock Exchange Of
Pair trading matchups for Stock Exchange
Mega Lifesciences Public
Pair trading matchups for Mega Lifesciences
Pair Trading with Stock Exchange and Mega Lifesciences
The main advantage of trading using opposite Stock Exchange and Mega Lifesciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stock Exchange position performs unexpectedly, Mega Lifesciences 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 Mega Lifesciences will offset losses from the drop in Mega Lifesciences' long position.| Stock Exchange vs. Turnkey Communication Services | Stock Exchange vs. Winnergy Medical Public | Stock Exchange vs. Charoen Pokphand Foods | Stock Exchange vs. Information and Communication |
| Mega Lifesciences vs. Home Product Center | Mega Lifesciences vs. Minor International Public | Mega Lifesciences vs. Com7 PCL | Mega Lifesciences vs. Bangkok Dusit Medical |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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