Correlation Between Dairy Farm and Made Tech

Can any of the company-specific risk be diversified away by investing in both Dairy Farm and Made Tech 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 Dairy Farm and Made Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dairy Farm International and Made Tech Group, you can compare the effects of market volatilities on Dairy Farm and Made Tech 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 Dairy Farm with a short position of Made Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dairy Farm and Made Tech.

Diversification Opportunities for Dairy Farm and Made Tech

0.0

Correlation Coefficient

Dairy Farm  Made Tech

Pay attention - limited upside

The 3 months correlation between Dairy and Made is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Dairy Farm International and Made Tech Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Made Tech Group and Dairy Farm 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 Dairy Farm International are associated (or correlated) with Made Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Made Tech Group has no effect on the direction of Dairy Farm i.e., Dairy Farm and Made Tech go up and down completely randomly.

Pair Corralation between Dairy Farm and Made Tech

If you would invest  2,500  in Made Tech Group on December 21, 2024 and sell it today you would earn a total of  150.00  from holding Made Tech Group or generate 6.0% return on investment over 90 days.

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

Dairy Farm International  vs.  Made Tech Group

Dairy Farm International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Dairy Farm International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Dairy Farm is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Made Tech Group

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Made Tech Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Made Tech may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Dairy Farm and Made Tech

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

The idea behind Dairy Farm International and Made Tech Group 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.