Correlation Between Chinyang Hold and Sunny Electronics
Can any of the company-specific risk be diversified away by investing in both Chinyang Hold and Sunny 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 Chinyang Hold and Sunny Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chinyang Hold and Sunny Electronics Corp, you can compare the effects of market volatilities on Chinyang Hold and Sunny 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 Chinyang Hold with a short position of Sunny Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chinyang Hold and Sunny Electronics.
Diversification Opportunities for Chinyang Hold and Sunny Electronics
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Chinyang and Sunny is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Chinyang Hold and Sunny Electronics Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunny Electronics Corp and Chinyang Hold 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 Chinyang Hold are associated (or correlated) with Sunny Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunny Electronics Corp has no effect on the direction of Chinyang Hold i.e., Chinyang Hold and Sunny Electronics go up and down completely randomly.
Pair Corralation between Chinyang Hold and Sunny Electronics
Assuming the 90 days trading horizon Chinyang Hold is expected to under-perform the Sunny Electronics. But the stock apears to be less risky and, when comparing its historical volatility, Chinyang Hold is 16.74 times less risky than Sunny Electronics. The stock trades about -0.29 of its potential returns per unit of risk. The Sunny Electronics Corp is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 165,400 in Sunny Electronics Corp on September 12, 2024 and sell it today you would earn a total of 94,100 from holding Sunny Electronics Corp or generate 56.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chinyang Hold vs. Sunny Electronics Corp
Performance |
| Timeline |
| Chinyang Hold |
| Sunny Electronics Corp |
Chinyang Hold and Sunny Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chinyang Hold and Sunny Electronics
The main advantage of trading using opposite Chinyang Hold and Sunny Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chinyang Hold position performs unexpectedly, Sunny 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 Sunny Electronics will offset losses from the drop in Sunny Electronics' long position.| Chinyang Hold vs. LG Chemicals | Chinyang Hold vs. POSCO Holdings | Chinyang Hold vs. Hanwha Solutions | Chinyang Hold vs. Lotte Chemical Corp |
| Sunny Electronics vs. Samsung Electronics Co | Sunny Electronics vs. Samsung Electronics Co | Sunny Electronics vs. SK Hynix | Sunny Electronics vs. POSCO Holdings |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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