Correlation Between Shin Tai and GameSparcs
Can any of the company-specific risk be diversified away by investing in both Shin Tai and GameSparcs 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 Shin Tai and GameSparcs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shin Tai Industry and GameSparcs Co, you can compare the effects of market volatilities on Shin Tai and GameSparcs 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 Shin Tai with a short position of GameSparcs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shin Tai and GameSparcs.
Diversification Opportunities for Shin Tai and GameSparcs
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Shin and GameSparcs is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Shin Tai Industry and GameSparcs Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GameSparcs and Shin Tai 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 Shin Tai Industry are associated (or correlated) with GameSparcs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GameSparcs has no effect on the direction of Shin Tai i.e., Shin Tai and GameSparcs go up and down completely randomly.
Pair Corralation between Shin Tai and GameSparcs
Assuming the 90 days trading horizon Shin Tai Industry is expected to generate 0.84 times more return on investment than GameSparcs. However, Shin Tai Industry is 1.19 times less risky than GameSparcs. It trades about 0.18 of its potential returns per unit of risk. GameSparcs Co is currently generating about -0.02 per unit of risk. If you would invest 9,100 in Shin Tai Industry on September 1, 2024 and sell it today you would earn a total of 5,550 from holding Shin Tai Industry or generate 60.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.66% |
| Values | Daily Returns |
Shin Tai Industry vs. GameSparcs Co
Performance |
| Timeline |
| Shin Tai Industry |
| GameSparcs |
Shin Tai and GameSparcs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shin Tai and GameSparcs
The main advantage of trading using opposite Shin Tai and GameSparcs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shin Tai position performs unexpectedly, GameSparcs 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 GameSparcs will offset losses from the drop in GameSparcs' long position.| Shin Tai vs. De Licacy Industrial | Shin Tai vs. Wisher Industrial Co | Shin Tai vs. Tainan Enterprises Co |
| GameSparcs vs. Powerchip Semiconductor Manufacturing | GameSparcs vs. BRIM Biotechnology | GameSparcs vs. Mospec Semiconductor Corp | GameSparcs vs. Sunmax Biotechnology Co |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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