Correlation Between SFP Tech and Uchi Technologies
Can any of the company-specific risk be diversified away by investing in both SFP Tech and Uchi Technologies 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 SFP Tech and Uchi Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SFP Tech Holdings and Uchi Technologies Bhd, you can compare the effects of market volatilities on SFP Tech and Uchi Technologies 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 SFP Tech with a short position of Uchi Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of SFP Tech and Uchi Technologies.
Diversification Opportunities for SFP Tech and Uchi Technologies
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SFP and Uchi is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding SFP Tech Holdings and Uchi Technologies Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uchi Technologies Bhd and SFP Tech 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 SFP Tech Holdings are associated (or correlated) with Uchi Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uchi Technologies Bhd has no effect on the direction of SFP Tech i.e., SFP Tech and Uchi Technologies go up and down completely randomly.
Pair Corralation between SFP Tech and Uchi Technologies
Assuming the 90 days trading horizon SFP Tech Holdings is expected to generate 3.48 times more return on investment than Uchi Technologies. However, SFP Tech is 3.48 times more volatile than Uchi Technologies Bhd. It trades about 0.25 of its potential returns per unit of risk. Uchi Technologies Bhd is currently generating about -0.01 per unit of risk. If you would invest 61.00 in SFP Tech Holdings on August 28, 2024 and sell it today you would earn a total of 8.00 from holding SFP Tech Holdings or generate 13.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SFP Tech Holdings vs. Uchi Technologies Bhd
Performance |
| Timeline |
| SFP Tech Holdings |
| Uchi Technologies Bhd |
SFP Tech and Uchi Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SFP Tech and Uchi Technologies
The main advantage of trading using opposite SFP Tech and Uchi Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SFP Tech position performs unexpectedly, Uchi Technologies 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 Uchi Technologies will offset losses from the drop in Uchi Technologies' long position.| SFP Tech vs. Malayan Banking Bhd | SFP Tech vs. Public Bank Bhd | SFP Tech vs. Petronas Chemicals Group | SFP Tech vs. Tenaga Nasional Bhd |
| Uchi Technologies vs. Digistar Bhd | Uchi Technologies vs. Minetech Resources Bhd | Uchi Technologies vs. OpenSys M Bhd | Uchi Technologies vs. Insas 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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