Correlation Between Shinkong Synthetic and Data International
Can any of the company-specific risk be diversified away by investing in both Shinkong Synthetic and Data International 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 Shinkong Synthetic and Data International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinkong Synthetic Fiber and Data International Co, you can compare the effects of market volatilities on Shinkong Synthetic and Data International 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 Shinkong Synthetic with a short position of Data International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinkong Synthetic and Data International.
Diversification Opportunities for Shinkong Synthetic and Data International
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shinkong and Data is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Shinkong Synthetic Fiber and Data International Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Data International and Shinkong Synthetic 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 Shinkong Synthetic Fiber are associated (or correlated) with Data International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Data International has no effect on the direction of Shinkong Synthetic i.e., Shinkong Synthetic and Data International go up and down completely randomly.
Pair Corralation between Shinkong Synthetic and Data International
Assuming the 90 days trading horizon Shinkong Synthetic Fiber is expected to generate 0.25 times more return on investment than Data International. However, Shinkong Synthetic Fiber is 4.05 times less risky than Data International. It trades about -0.01 of its potential returns per unit of risk. Data International Co is currently generating about -0.25 per unit of risk. If you would invest 1,530 in Shinkong Synthetic Fiber on October 30, 2024 and sell it today you would lose (15.00) from holding Shinkong Synthetic Fiber or give up 0.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinkong Synthetic Fiber vs. Data International Co
Performance |
| Timeline |
| Shinkong Synthetic Fiber |
| Data International |
Shinkong Synthetic and Data International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinkong Synthetic and Data International
The main advantage of trading using opposite Shinkong Synthetic and Data International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinkong Synthetic position performs unexpectedly, Data International 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 Data International will offset losses from the drop in Data International's long position.| Shinkong Synthetic vs. Nan Ya Plastics | Shinkong Synthetic vs. Formosa Chemicals Fibre | Shinkong Synthetic vs. China Steel Corp | Shinkong Synthetic vs. Formosa Petrochemical Corp |
| Data International vs. Aker Technology Co | Data International vs. Genovate Biotechnology Co | Data International vs. Formosa Chemicals Fibre | Data International vs. United Radiant Technology |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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