Correlation Between Victory New and CSBC Corp
Can any of the company-specific risk be diversified away by investing in both Victory New and CSBC Corp 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 Victory New and CSBC Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Victory New Materials and CSBC Corp Taiwan, you can compare the effects of market volatilities on Victory New and CSBC Corp 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 Victory New with a short position of CSBC Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory New and CSBC Corp.
Diversification Opportunities for Victory New and CSBC Corp
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Victory and CSBC is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Victory New Materials and CSBC Corp Taiwan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSBC Corp Taiwan and Victory New 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 Victory New Materials are associated (or correlated) with CSBC Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSBC Corp Taiwan has no effect on the direction of Victory New i.e., Victory New and CSBC Corp go up and down completely randomly.
Pair Corralation between Victory New and CSBC Corp
Assuming the 90 days trading horizon Victory New Materials is expected to generate 0.86 times more return on investment than CSBC Corp. However, Victory New Materials is 1.16 times less risky than CSBC Corp. It trades about -0.06 of its potential returns per unit of risk. CSBC Corp Taiwan is currently generating about -0.06 per unit of risk. If you would invest 1,015 in Victory New Materials on August 28, 2024 and sell it today you would lose (15.00) from holding Victory New Materials or give up 1.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Victory New Materials vs. CSBC Corp Taiwan
Performance |
| Timeline |
| Victory New Materials |
| CSBC Corp Taiwan |
Victory New and CSBC Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Victory New and CSBC Corp
The main advantage of trading using opposite Victory New and CSBC Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Victory New position performs unexpectedly, CSBC Corp 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 CSBC Corp will offset losses from the drop in CSBC Corp's long position.| Victory New vs. Asia Plastic Recycling | Victory New vs. Hunya Foods Co | Victory New vs. Kwong Fong Industries | Victory New vs. De Licacy Industrial |
| CSBC Corp vs. Sincere Navigation Corp | CSBC Corp vs. Evergreen International Storage | CSBC Corp vs. First Steamship Co | CSBC Corp vs. Mercuries Life Insurance |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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