Correlation Between Tung Ho and Acelon Chemicals
Can any of the company-specific risk be diversified away by investing in both Tung Ho and Acelon Chemicals 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 Tung Ho and Acelon Chemicals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tung Ho Textile and Acelon Chemicals Fiber, you can compare the effects of market volatilities on Tung Ho and Acelon Chemicals 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 Tung Ho with a short position of Acelon Chemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tung Ho and Acelon Chemicals.
Diversification Opportunities for Tung Ho and Acelon Chemicals
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tung and Acelon is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Tung Ho Textile and Acelon Chemicals Fiber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acelon Chemicals Fiber and Tung Ho 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 Tung Ho Textile are associated (or correlated) with Acelon Chemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acelon Chemicals Fiber has no effect on the direction of Tung Ho i.e., Tung Ho and Acelon Chemicals go up and down completely randomly.
Pair Corralation between Tung Ho and Acelon Chemicals
Assuming the 90 days trading horizon Tung Ho Textile is expected to generate 0.81 times more return on investment than Acelon Chemicals. However, Tung Ho Textile is 1.23 times less risky than Acelon Chemicals. It trades about 0.06 of its potential returns per unit of risk. Acelon Chemicals Fiber is currently generating about 0.04 per unit of risk. If you would invest 1,748 in Tung Ho Textile on September 2, 2024 and sell it today you would earn a total of 627.00 from holding Tung Ho Textile or generate 35.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tung Ho Textile vs. Acelon Chemicals Fiber
Performance |
| Timeline |
| Tung Ho Textile |
| Acelon Chemicals Fiber |
Tung Ho and Acelon Chemicals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tung Ho and Acelon Chemicals
The main advantage of trading using opposite Tung Ho and Acelon Chemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tung Ho position performs unexpectedly, Acelon Chemicals 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 Acelon Chemicals will offset losses from the drop in Acelon Chemicals' long position.| Tung Ho vs. Chaintech Technology Corp | Tung Ho vs. Avision | Tung Ho vs. Clevo Co | Tung Ho vs. Elitegroup Computer Systems |
| Acelon Chemicals vs. Chaintech Technology Corp | Acelon Chemicals vs. Avision | Acelon Chemicals vs. Clevo Co | Acelon Chemicals vs. Elitegroup Computer Systems |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |