Correlation Between MI Technovation and Sunway Construction
Can any of the company-specific risk be diversified away by investing in both MI Technovation and Sunway Construction 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 MI Technovation and Sunway Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MI Technovation Bhd and Sunway Construction Group, you can compare the effects of market volatilities on MI Technovation and Sunway Construction 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 MI Technovation with a short position of Sunway Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of MI Technovation and Sunway Construction.
Diversification Opportunities for MI Technovation and Sunway Construction
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between 5286 and Sunway is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding MI Technovation Bhd and Sunway Construction Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunway Construction and MI Technovation 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 MI Technovation Bhd are associated (or correlated) with Sunway Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunway Construction has no effect on the direction of MI Technovation i.e., MI Technovation and Sunway Construction go up and down completely randomly.
Pair Corralation between MI Technovation and Sunway Construction
Assuming the 90 days trading horizon MI Technovation Bhd is expected to generate 1.16 times more return on investment than Sunway Construction. However, MI Technovation is 1.16 times more volatile than Sunway Construction Group. It trades about 0.14 of its potential returns per unit of risk. Sunway Construction Group is currently generating about 0.04 per unit of risk. If you would invest 184.00 in MI Technovation Bhd on September 25, 2024 and sell it today you would earn a total of 40.00 from holding MI Technovation Bhd or generate 21.74% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
MI Technovation Bhd vs. Sunway Construction Group
Performance |
Timeline |
MI Technovation Bhd |
Sunway Construction |
MI Technovation and Sunway Construction Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with MI Technovation and Sunway Construction
The main advantage of trading using opposite MI Technovation and Sunway Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MI Technovation position performs unexpectedly, Sunway Construction 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 Sunway Construction will offset losses from the drop in Sunway Construction's long position.MI Technovation vs. Inari Amertron Bhd | MI Technovation vs. ViTrox Bhd | MI Technovation vs. Globetronics Tech Bhd |
Sunway Construction vs. ES Ceramics Technology | Sunway Construction vs. MI Technovation Bhd | Sunway Construction vs. Diversified Gateway Solutions | Sunway Construction vs. MClean Technologies Bhd |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
Bonds Directory Find actively traded corporate debentures issued by US companies | |
Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |