Correlation Between MI Technovation and Swift Haulage

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

By analyzing existing cross correlation between MI Technovation Bhd and Swift Haulage Bhd, you can compare the effects of market volatilities on MI Technovation and Swift Haulage 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 MI Technovation with a short position of Swift Haulage. Check out your portfolio center. Please also check ongoing floating volatility patterns of MI Technovation and Swift Haulage.

Diversification Opportunities for MI Technovation and Swift Haulage

0.78

Correlation Coefficient

MI Technovation  Swift Haulage

Poor diversification

The 3 months correlation between 5286 and Swift is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding MI Technovation Bhd and Swift Haulage Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swift Haulage Bhd and MI Technovation 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 MI Technovation Bhd are associated (or correlated) with Swift Haulage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swift Haulage Bhd has no effect on the direction of MI Technovation i.e., MI Technovation and Swift Haulage go up and down completely randomly.

Pair Corralation between MI Technovation and Swift Haulage

Assuming the 90 days trading horizon MI Technovation Bhd is expected to under-perform the Swift Haulage. In addition to that, MI Technovation is 1.26 times more volatile than Swift Haulage Bhd. It trades about -0.14 of its total potential returns per unit of risk. Swift Haulage Bhd is currently generating about -0.06 per unit of volatility. If you would invest  43.00  in Swift Haulage Bhd on December 30, 2024 and sell it today you would lose (3.00) from holding Swift Haulage Bhd or give up 6.98% of portfolio value over 90 days.

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

MI Technovation Bhd  vs.  Swift Haulage Bhd

MI Technovation Bhd

Risk-Adjusted Performance

Very Weak

Over the last 90 days MI Technovation Bhd has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Swift Haulage Bhd

Risk-Adjusted Performance

Very Weak

Over the last 90 days Swift Haulage Bhd has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with MI Technovation and Swift Haulage

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

The idea behind MI Technovation Bhd and Swift Haulage Bhd 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.