Correlation Between Micro Imaging and MW Investment

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

By analyzing existing cross correlation between Micro Imaging Technology and MW Investment Holding, you can compare the effects of market volatilities on Micro Imaging and MW Investment 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 Micro Imaging with a short position of MW Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Micro Imaging and MW Investment.

Diversification Opportunities for Micro Imaging and MW Investment

1.0

Correlation Coefficient

Micro Imaging  MW Investment

No risk reduction

The 3 months correlation between Micro and MEGH is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Micro Imaging Technology and MW Investment Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MW Investment Holding and Micro Imaging 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 Micro Imaging Technology are associated (or correlated) with MW Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MW Investment Holding has no effect on the direction of Micro Imaging i.e., Micro Imaging and MW Investment go up and down completely randomly.

Pair Corralation between Micro Imaging and MW Investment

If you would invest  0.02  in MW Investment Holding on October 24, 2024 and sell it today you would earn a total of  0.00  from holding MW Investment Holding or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	96.83%
Values	Daily Returns

Micro Imaging Technology  vs.  MW Investment Holding

Micro Imaging Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Micro Imaging Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Micro Imaging is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

MW Investment Holding

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MW Investment Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical and fundamental indicators, MW Investment is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Micro Imaging and MW Investment

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

The idea behind Micro Imaging Technology and MW Investment Holding 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.