Correlation Between Tehmag Foods and Cowealth Medical
Can any of the company-specific risk be diversified away by investing in both Tehmag Foods and Cowealth Medical 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 Tehmag Foods and Cowealth Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tehmag Foods and Cowealth Medical Holding, you can compare the effects of market volatilities on Tehmag Foods and Cowealth Medical 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 Tehmag Foods with a short position of Cowealth Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tehmag Foods and Cowealth Medical.
Diversification Opportunities for Tehmag Foods and Cowealth Medical
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tehmag and Cowealth is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Tehmag Foods and Cowealth Medical Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cowealth Medical Holding and Tehmag Foods 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 Tehmag Foods are associated (or correlated) with Cowealth Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cowealth Medical Holding has no effect on the direction of Tehmag Foods i.e., Tehmag Foods and Cowealth Medical go up and down completely randomly.
Pair Corralation between Tehmag Foods and Cowealth Medical
Assuming the 90 days trading horizon Tehmag Foods is expected to generate 0.45 times more return on investment than Cowealth Medical. However, Tehmag Foods is 2.22 times less risky than Cowealth Medical. It trades about 0.07 of its potential returns per unit of risk. Cowealth Medical Holding is currently generating about -0.06 per unit of risk. If you would invest 28,927 in Tehmag Foods on November 1, 2024 and sell it today you would earn a total of 2,873 from holding Tehmag Foods or generate 9.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tehmag Foods vs. Cowealth Medical Holding
Performance |
| Timeline |
| Tehmag Foods |
| Cowealth Medical Holding |
Tehmag Foods and Cowealth Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tehmag Foods and Cowealth Medical
The main advantage of trading using opposite Tehmag Foods and Cowealth Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tehmag Foods position performs unexpectedly, Cowealth Medical 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 Cowealth Medical will offset losses from the drop in Cowealth Medical's long position.| Tehmag Foods vs. Ambassador Hotel | Tehmag Foods vs. Ching Feng Home | Tehmag Foods vs. Trade Van Information Services | Tehmag Foods vs. Fortune Information Systems |
| Cowealth Medical vs. Lien Chang Electronic | Cowealth Medical vs. Louisa Professional Coffee | Cowealth Medical vs. Tehmag Foods | Cowealth Medical vs. China Times Publishing |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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