Correlation Between Chung Fu and Orient Semiconductor
Can any of the company-specific risk be diversified away by investing in both Chung Fu and Orient Semiconductor 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 Chung Fu and Orient Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chung Fu Tex International and Orient Semiconductor Electronics, you can compare the effects of market volatilities on Chung Fu and Orient Semiconductor 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 Chung Fu with a short position of Orient Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chung Fu and Orient Semiconductor.
Diversification Opportunities for Chung Fu and Orient Semiconductor
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Chung and Orient is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Chung Fu Tex International and Orient Semiconductor Electroni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orient Semiconductor and Chung Fu 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 Chung Fu Tex International are associated (or correlated) with Orient Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orient Semiconductor has no effect on the direction of Chung Fu i.e., Chung Fu and Orient Semiconductor go up and down completely randomly.
Pair Corralation between Chung Fu and Orient Semiconductor
Assuming the 90 days trading horizon Chung Fu Tex International is expected to under-perform the Orient Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Chung Fu Tex International is 1.23 times less risky than Orient Semiconductor. The stock trades about -0.25 of its potential returns per unit of risk. The Orient Semiconductor Electronics is currently generating about -0.19 of returns per unit of risk over similar time horizon. If you would invest 4,175 in Orient Semiconductor Electronics on August 29, 2024 and sell it today you would lose (505.00) from holding Orient Semiconductor Electronics or give up 12.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chung Fu Tex International vs. Orient Semiconductor Electroni
Performance |
| Timeline |
| Chung Fu Tex |
| Orient Semiconductor |
Chung Fu and Orient Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chung Fu and Orient Semiconductor
The main advantage of trading using opposite Chung Fu and Orient Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chung Fu position performs unexpectedly, Orient Semiconductor 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 Orient Semiconductor will offset losses from the drop in Orient Semiconductor's long position.| Chung Fu vs. Chainqui Construction Development | Chung Fu vs. Zinwell | Chung Fu vs. Symtek Automation Asia | Chung Fu vs. CTCI Corp |
| Orient Semiconductor vs. Macronix International Co | Orient Semiconductor vs. Silicon Integrated Systems | Orient Semiconductor vs. Winbond Electronics Corp | Orient Semiconductor vs. Mosel Vitelic |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |