Correlation Between Ming Yang and Maider Medical

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

By analyzing existing cross correlation between Ming Yang Smart and Maider Medical Industry, you can compare the effects of market volatilities on Ming Yang and Maider Medical 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 Ming Yang with a short position of Maider Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ming Yang and Maider Medical.

Diversification Opportunities for Ming Yang and Maider Medical

0.62

Correlation Coefficient

Ming Yang  Maider Medical

Poor diversification

The 3 months correlation between Ming and Maider is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Ming Yang Smart and Maider Medical Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maider Medical Industry and Ming Yang 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 Ming Yang Smart are associated (or correlated) with Maider Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maider Medical Industry has no effect on the direction of Ming Yang i.e., Ming Yang and Maider Medical go up and down completely randomly.

Pair Corralation between Ming Yang and Maider Medical

Assuming the 90 days trading horizon Ming Yang Smart is expected to under-perform the Maider Medical. In addition to that, Ming Yang is 1.17 times more volatile than Maider Medical Industry. It trades about -0.52 of its total potential returns per unit of risk. Maider Medical Industry is currently generating about -0.49 per unit of volatility. If you would invest  1,270  in Maider Medical Industry on October 16, 2024 and sell it today you would lose (235.00) from holding Maider Medical Industry or give up 18.5% of portfolio value over 90 days.

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

Ming Yang Smart  vs.  Maider Medical Industry

Ming Yang Smart

Risk-Adjusted Performance

3 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ming Yang Smart are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Ming Yang may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Maider Medical Industry

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Maider Medical Industry has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Ming Yang and Maider Medical

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

The idea behind Ming Yang Smart and Maider Medical Industry 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.