Correlation Between Mind Technology and SOLEIN

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

By analyzing existing cross correlation between Mind Technology and SOLEIN 7125 01 OCT 27, you can compare the effects of market volatilities on Mind Technology and SOLEIN 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 Mind Technology with a short position of SOLEIN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mind Technology and SOLEIN.

Diversification Opportunities for Mind Technology and SOLEIN

0.4

Correlation Coefficient

Mind Technology  SOLEIN

Very weak diversification

The 3 months correlation between Mind and SOLEIN is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Mind Technology and SOLEIN 7125 01 OCT 27 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOLEIN 7125 01 and Mind Technology 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 Mind Technology are associated (or correlated) with SOLEIN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOLEIN 7125 01 has no effect on the direction of Mind Technology i.e., Mind Technology and SOLEIN go up and down completely randomly.

Pair Corralation between Mind Technology and SOLEIN

Given the investment horizon of 90 days Mind Technology is expected to under-perform the SOLEIN. In addition to that, Mind Technology is 16.45 times more volatile than SOLEIN 7125 01 OCT 27. It trades about -0.09 of its total potential returns per unit of risk. SOLEIN 7125 01 OCT 27 is currently generating about -0.09 per unit of volatility. If you would invest  10,180  in SOLEIN 7125 01 OCT 27 on December 30, 2024 and sell it today you would lose (104.00) from holding SOLEIN 7125 01 OCT 27 or give up 1.02% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	66.13%
Values	Daily Returns

Mind Technology  vs.  SOLEIN 7125 01 OCT 27

Mind Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Mind Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

SOLEIN 7125 01

Risk-Adjusted Performance

Very Weak

Over the last 90 days SOLEIN 7125 01 OCT 27 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, SOLEIN is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Mind Technology and SOLEIN

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

The idea behind Mind Technology and SOLEIN 7125 01 OCT 27 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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.