Correlation Between MediaTek and Kura Sushi

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

By analyzing existing cross correlation between MediaTek and Kura Sushi Asia, you can compare the effects of market volatilities on MediaTek and Kura Sushi 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 MediaTek with a short position of Kura Sushi. Check out your portfolio center. Please also check ongoing floating volatility patterns of MediaTek and Kura Sushi.

Diversification Opportunities for MediaTek and Kura Sushi

-0.35

Correlation Coefficient

MediaTek  Kura Sushi

Very good diversification

The 3 months correlation between MediaTek and Kura is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding MediaTek and Kura Sushi Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kura Sushi Asia and MediaTek 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 MediaTek are associated (or correlated) with Kura Sushi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kura Sushi Asia has no effect on the direction of MediaTek i.e., MediaTek and Kura Sushi go up and down completely randomly.

Pair Corralation between MediaTek and Kura Sushi

Assuming the 90 days trading horizon MediaTek is expected to generate 1.0 times more return on investment than Kura Sushi. However, MediaTek is 1.0 times more volatile than Kura Sushi Asia. It trades about 0.07 of its potential returns per unit of risk. Kura Sushi Asia is currently generating about -0.04 per unit of risk. If you would invest  73,900  in MediaTek on October 9, 2024 and sell it today you would earn a total of  68,600  from holding MediaTek or generate 92.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.79%
Values	Daily Returns

MediaTek  vs.  Kura Sushi Asia

MediaTek

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in MediaTek are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, MediaTek showed solid returns over the last few months and may actually be approaching a breakup point.

Kura Sushi Asia

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kura Sushi Asia has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with MediaTek and Kura Sushi

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

The idea behind MediaTek and Kura Sushi Asia 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..