Correlation Between Victory New and Casing Macron
Can any of the company-specific risk be diversified away by investing in both Victory New and Casing Macron 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 Casing Macron 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 Casing Macron Technology, you can compare the effects of market volatilities on Victory New and Casing Macron 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 Casing Macron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory New and Casing Macron.
Diversification Opportunities for Victory New and Casing Macron
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Victory and Casing is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Victory New Materials and Casing Macron Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Casing Macron Technology 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 Casing Macron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Casing Macron Technology has no effect on the direction of Victory New i.e., Victory New and Casing Macron go up and down completely randomly.
Pair Corralation between Victory New and Casing Macron
Assuming the 90 days trading horizon Victory New Materials is expected to generate 0.29 times more return on investment than Casing Macron. However, Victory New Materials is 3.5 times less risky than Casing Macron. It trades about -0.34 of its potential returns per unit of risk. Casing Macron Technology is currently generating about -0.25 per unit of risk. If you would invest 1,005 in Victory New Materials on September 13, 2024 and sell it today you would lose (34.00) from holding Victory New Materials or give up 3.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Victory New Materials vs. Casing Macron Technology
Performance |
| Timeline |
| Victory New Materials |
| Casing Macron Technology |
Victory New and Casing Macron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Victory New and Casing Macron
The main advantage of trading using opposite Victory New and Casing Macron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Victory New position performs unexpectedly, Casing Macron 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 Casing Macron will offset losses from the drop in Casing Macron's long position.| Victory New vs. Feng Tay Enterprises | Victory New vs. Pou Chen Corp | Victory New vs. Fulgent Sun International | Victory New vs. Hsinli Chemical Industrial |
| Casing Macron vs. Taiwan Semiconductor Co | Casing Macron vs. Farglory FTZ Investment | Casing Macron vs. Double Bond Chemical | Casing Macron vs. Elite Semiconductor Memory |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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