Correlation Between PJ Electronics and Vissem Electronics
Can any of the company-specific risk be diversified away by investing in both PJ Electronics and Vissem Electronics 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 PJ Electronics and Vissem Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PJ Electronics Co and Vissem Electronics Co, you can compare the effects of market volatilities on PJ Electronics and Vissem Electronics 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 PJ Electronics with a short position of Vissem Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of PJ Electronics and Vissem Electronics.
Diversification Opportunities for PJ Electronics and Vissem Electronics
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 006140 and Vissem is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding PJ Electronics Co and Vissem Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vissem Electronics and PJ Electronics 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 PJ Electronics Co are associated (or correlated) with Vissem Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vissem Electronics has no effect on the direction of PJ Electronics i.e., PJ Electronics and Vissem Electronics go up and down completely randomly.
Pair Corralation between PJ Electronics and Vissem Electronics
Assuming the 90 days trading horizon PJ Electronics Co is expected to generate 2.98 times more return on investment than Vissem Electronics. However, PJ Electronics is 2.98 times more volatile than Vissem Electronics Co. It trades about 0.27 of its potential returns per unit of risk. Vissem Electronics Co is currently generating about 0.13 per unit of risk. If you would invest 450,000 in PJ Electronics Co on October 30, 2024 and sell it today you would earn a total of 75,000 from holding PJ Electronics Co or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PJ Electronics Co vs. Vissem Electronics Co
Performance |
| Timeline |
| PJ Electronics |
| Vissem Electronics |
PJ Electronics and Vissem Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PJ Electronics and Vissem Electronics
The main advantage of trading using opposite PJ Electronics and Vissem Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PJ Electronics position performs unexpectedly, Vissem Electronics 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 Vissem Electronics will offset losses from the drop in Vissem Electronics' long position.| PJ Electronics vs. DAEDUCK ELECTRONICS CoLtd | PJ Electronics vs. KyungIn Electronics Co | PJ Electronics vs. Anam Electronics Co | PJ Electronics vs. Sungmoon Electronics Co |
| Vissem Electronics vs. TJ media Co | Vissem Electronics vs. Infinitt Healthcare Co | Vissem Electronics vs. LG Household Healthcare | Vissem Electronics vs. ChipsMedia |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |