Correlation Between Mirle Automation and C Sun

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

By analyzing existing cross correlation between Mirle Automation Corp and C Sun Manufacturing, you can compare the effects of market volatilities on Mirle Automation and C Sun 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 Mirle Automation with a short position of C Sun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mirle Automation and C Sun.

Diversification Opportunities for Mirle Automation and C Sun

0.02

Correlation Coefficient

Mirle Automation  C Sun

Significant diversification

The 3 months correlation between Mirle and 2467 is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Mirle Automation Corp and C Sun Manufacturing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on C Sun Manufacturing and Mirle Automation 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 Mirle Automation Corp are associated (or correlated) with C Sun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of C Sun Manufacturing has no effect on the direction of Mirle Automation i.e., Mirle Automation and C Sun go up and down completely randomly.

Pair Corralation between Mirle Automation and C Sun

Assuming the 90 days trading horizon Mirle Automation is expected to generate 1.7 times less return on investment than C Sun. But when comparing it to its historical volatility, Mirle Automation Corp is 1.13 times less risky than C Sun. It trades about 0.01 of its potential returns per unit of risk. C Sun Manufacturing is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  20,650  in C Sun Manufacturing on October 7, 2024 and sell it today you would lose (750.00) from holding C Sun Manufacturing or give up 3.63% of portfolio value over 90 days.

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

Mirle Automation Corp  vs.  C Sun Manufacturing

Mirle Automation Corp

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Mirle Automation Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Mirle Automation is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

C Sun Manufacturing

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days C Sun Manufacturing has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Mirle Automation and C Sun

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

The idea behind Mirle Automation Corp and C Sun Manufacturing 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.