Correlation Between COFCO Joycome and STHREE PLC
Can any of the company-specific risk be diversified away by investing in both COFCO Joycome and STHREE PLC 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 COFCO Joycome and STHREE PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COFCO Joycome Foods and STHREE PLC LS, you can compare the effects of market volatilities on COFCO Joycome and STHREE PLC 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 COFCO Joycome with a short position of STHREE PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of COFCO Joycome and STHREE PLC.
Diversification Opportunities for COFCO Joycome and STHREE PLC
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between COFCO and STHREE is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding COFCO Joycome Foods and STHREE PLC LS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STHREE PLC LS and COFCO Joycome 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 COFCO Joycome Foods are associated (or correlated) with STHREE PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STHREE PLC LS has no effect on the direction of COFCO Joycome i.e., COFCO Joycome and STHREE PLC go up and down completely randomly.
Pair Corralation between COFCO Joycome and STHREE PLC
Assuming the 90 days horizon COFCO Joycome Foods is expected to generate 0.57 times more return on investment than STHREE PLC. However, COFCO Joycome Foods is 1.75 times less risky than STHREE PLC. It trades about 0.09 of its potential returns per unit of risk. STHREE PLC LS is currently generating about -0.16 per unit of risk. If you would invest 17.00 in COFCO Joycome Foods on September 15, 2024 and sell it today you would earn a total of 1.00 from holding COFCO Joycome Foods or generate 5.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
COFCO Joycome Foods vs. STHREE PLC LS
Performance |
| Timeline |
| COFCO Joycome Foods |
| STHREE PLC LS |
COFCO Joycome and STHREE PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COFCO Joycome and STHREE PLC
The main advantage of trading using opposite COFCO Joycome and STHREE PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COFCO Joycome position performs unexpectedly, STHREE PLC 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 STHREE PLC will offset losses from the drop in STHREE PLC's long position.| COFCO Joycome vs. Hormel Foods | COFCO Joycome vs. Superior Plus Corp | COFCO Joycome vs. SIVERS SEMICONDUCTORS AB | COFCO Joycome vs. NorAm Drilling AS |
| STHREE PLC vs. HK Electric Investments | STHREE PLC vs. Postal Savings Bank | STHREE PLC vs. Thai Beverage Public | STHREE PLC vs. COFCO Joycome Foods |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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