Correlation Between Inmax Holding and Hiwin Mikrosystem

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Can any of the company-specific risk be diversified away by investing in both Inmax Holding and Hiwin Mikrosystem 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 Inmax Holding and Hiwin Mikrosystem into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inmax Holding Co and Hiwin Mikrosystem Corp, you can compare the effects of market volatilities on Inmax Holding and Hiwin Mikrosystem 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 Inmax Holding with a short position of Hiwin Mikrosystem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inmax Holding and Hiwin Mikrosystem.

Diversification Opportunities for Inmax Holding and Hiwin Mikrosystem

-0.15
  Correlation Coefficient

Good diversification

The 3 months correlation between Inmax and Hiwin is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Inmax Holding Co and Hiwin Mikrosystem Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hiwin Mikrosystem Corp and Inmax Holding 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 Inmax Holding Co are associated (or correlated) with Hiwin Mikrosystem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hiwin Mikrosystem Corp has no effect on the direction of Inmax Holding i.e., Inmax Holding and Hiwin Mikrosystem go up and down completely randomly.

Pair Corralation between Inmax Holding and Hiwin Mikrosystem

Assuming the 90 days trading horizon Inmax Holding Co is expected to generate 1.11 times more return on investment than Hiwin Mikrosystem. However, Inmax Holding is 1.11 times more volatile than Hiwin Mikrosystem Corp. It trades about 0.1 of its potential returns per unit of risk. Hiwin Mikrosystem Corp is currently generating about 0.05 per unit of risk. If you would invest  1,635  in Inmax Holding Co on September 18, 2024 and sell it today you would earn a total of  3,845  from holding Inmax Holding Co or generate 235.17% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Inmax Holding Co  vs.  Hiwin Mikrosystem Corp

 Performance 
       Timeline  
Inmax Holding 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Inmax Holding Co are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Inmax Holding showed solid returns over the last few months and may actually be approaching a breakup point.
Hiwin Mikrosystem Corp 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Hiwin Mikrosystem Corp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Hiwin Mikrosystem showed solid returns over the last few months and may actually be approaching a breakup point.

Inmax Holding and Hiwin Mikrosystem Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Inmax Holding and Hiwin Mikrosystem

The main advantage of trading using opposite Inmax Holding and Hiwin Mikrosystem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inmax Holding position performs unexpectedly, Hiwin Mikrosystem 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 Hiwin Mikrosystem will offset losses from the drop in Hiwin Mikrosystem's long position.
The idea behind Inmax Holding Co and Hiwin Mikrosystem Corp 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.

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