Correlation Between Jia Jie and Min Aik
Can any of the company-specific risk be diversified away by investing in both Jia Jie and Min Aik 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 Jia Jie and Min Aik into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jia Jie Biomedical and Min Aik Technology, you can compare the effects of market volatilities on Jia Jie and Min Aik 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 Jia Jie with a short position of Min Aik. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jia Jie and Min Aik.
Diversification Opportunities for Jia Jie and Min Aik
Good diversification
The 3 months correlation between Jia and Min is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Jia Jie Biomedical and Min Aik Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Min Aik Technology and Jia Jie 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 Jia Jie Biomedical are associated (or correlated) with Min Aik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Min Aik Technology has no effect on the direction of Jia Jie i.e., Jia Jie and Min Aik go up and down completely randomly.
Pair Corralation between Jia Jie and Min Aik
Assuming the 90 days trading horizon Jia Jie Biomedical is expected to under-perform the Min Aik. In addition to that, Jia Jie is 1.09 times more volatile than Min Aik Technology. It trades about -0.1 of its total potential returns per unit of risk. Min Aik Technology is currently generating about -0.01 per unit of volatility. If you would invest 2,500 in Min Aik Technology on December 5, 2024 and sell it today you would lose (135.00) from holding Min Aik Technology or give up 5.4% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Jia Jie Biomedical vs. Min Aik Technology
Performance |
Timeline |
Jia Jie Biomedical |
Min Aik Technology |
Jia Jie and Min Aik Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jia Jie and Min Aik
The main advantage of trading using opposite Jia Jie and Min Aik positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jia Jie position performs unexpectedly, Min Aik 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 Min Aik will offset losses from the drop in Min Aik's long position.Jia Jie vs. First Hotel Co | Jia Jie vs. Chernan Metal Industrial | Jia Jie vs. Formosa International Hotels | Jia Jie vs. Galaxy Software Services |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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