Correlation Between SAMYOUNG M and MITECH CoLtd

Can any of the company-specific risk be diversified away by investing in both SAMYOUNG M and MITECH CoLtd 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 SAMYOUNG M and MITECH CoLtd into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SAMYOUNG M Tek Co and MITECH CoLtd, you can compare the effects of market volatilities on SAMYOUNG M and MITECH CoLtd 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 SAMYOUNG M with a short position of MITECH CoLtd. Check out your portfolio center. Please also check ongoing floating volatility patterns of SAMYOUNG M and MITECH CoLtd.

Diversification Opportunities for SAMYOUNG M and MITECH CoLtd

-0.22

Correlation Coefficient

SAMYOUNG M  MITECH CoLtd

Very good diversification

The 3 months correlation between SAMYOUNG and MITECH is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding SAMYOUNG M Tek Co and MITECH CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MITECH CoLtd and SAMYOUNG M 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 SAMYOUNG M Tek Co are associated (or correlated) with MITECH CoLtd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MITECH CoLtd has no effect on the direction of SAMYOUNG M i.e., SAMYOUNG M and MITECH CoLtd go up and down completely randomly.

Pair Corralation between SAMYOUNG M and MITECH CoLtd

Assuming the 90 days trading horizon SAMYOUNG M Tek Co is expected to generate 0.77 times more return on investment than MITECH CoLtd. However, SAMYOUNG M Tek Co is 1.3 times less risky than MITECH CoLtd. It trades about 0.04 of its potential returns per unit of risk. MITECH CoLtd is currently generating about 0.0 per unit of risk. If you would invest  395,283  in SAMYOUNG M Tek Co on October 4, 2024 and sell it today you would earn a total of  75,717  from holding SAMYOUNG M Tek Co or generate 19.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

SAMYOUNG M Tek Co  vs.  MITECH CoLtd

SAMYOUNG M Tek

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SAMYOUNG M Tek Co are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, SAMYOUNG M sustained solid returns over the last few months and may actually be approaching a breakup point.

MITECH CoLtd

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in MITECH CoLtd are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, MITECH CoLtd is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with SAMYOUNG M and MITECH CoLtd

The main advantage of trading using opposite SAMYOUNG M and MITECH CoLtd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SAMYOUNG M position performs unexpectedly, MITECH CoLtd 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 MITECH CoLtd will offset losses from the drop in MITECH CoLtd's long position.

The idea behind SAMYOUNG M Tek Co and MITECH CoLtd pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.