Correlation Between Mitake Information and Wah Hong
Can any of the company-specific risk be diversified away by investing in both Mitake Information and Wah Hong 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 Mitake Information and Wah Hong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mitake Information and Wah Hong Industrial, you can compare the effects of market volatilities on Mitake Information and Wah Hong 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 Mitake Information with a short position of Wah Hong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mitake Information and Wah Hong.
Diversification Opportunities for Mitake Information and Wah Hong
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Mitake and Wah is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Mitake Information and Wah Hong Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wah Hong Industrial and Mitake Information 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 Mitake Information are associated (or correlated) with Wah Hong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wah Hong Industrial has no effect on the direction of Mitake Information i.e., Mitake Information and Wah Hong go up and down completely randomly.
Pair Corralation between Mitake Information and Wah Hong
Assuming the 90 days trading horizon Mitake Information is expected to generate 0.27 times more return on investment than Wah Hong. However, Mitake Information is 3.73 times less risky than Wah Hong. It trades about 0.03 of its potential returns per unit of risk. Wah Hong Industrial is currently generating about -0.11 per unit of risk. If you would invest 6,660 in Mitake Information on September 25, 2024 and sell it today you would earn a total of 30.00 from holding Mitake Information or generate 0.45% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 95.45% |
Values | Daily Returns |
Mitake Information vs. Wah Hong Industrial
Performance |
Timeline |
Mitake Information |
Wah Hong Industrial |
Mitake Information and Wah Hong Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mitake Information and Wah Hong
The main advantage of trading using opposite Mitake Information and Wah Hong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mitake Information position performs unexpectedly, Wah Hong 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 Wah Hong will offset losses from the drop in Wah Hong's long position.Mitake Information vs. Interactive Digital Technologies | Mitake Information vs. APEX International Financial | Mitake Information vs. K Way Information | Mitake Information vs. Jentech Precision Industrial |
Wah Hong vs. Advantech Co | Wah Hong vs. IEI Integration Corp | Wah Hong vs. Flytech Technology Co | Wah Hong vs. Ennoconn Corp |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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