Correlation Between Chung Fu and Good Will
Can any of the company-specific risk be diversified away by investing in both Chung Fu and Good Will 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 Good Will 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 Good Will Instrument, you can compare the effects of market volatilities on Chung Fu and Good Will 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 Good Will. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chung Fu and Good Will.
Diversification Opportunities for Chung Fu and Good Will
Very good diversification
The 3 months correlation between Chung and Good is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Chung Fu Tex International and Good Will Instrument in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Good Will Instrument 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 Good Will. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Good Will Instrument has no effect on the direction of Chung Fu i.e., Chung Fu and Good Will go up and down completely randomly.
Pair Corralation between Chung Fu and Good Will
Assuming the 90 days trading horizon Chung Fu Tex International is expected to under-perform the Good Will. In addition to that, Chung Fu is 2.0 times more volatile than Good Will Instrument. It trades about -0.16 of its total potential returns per unit of risk. Good Will Instrument is currently generating about 0.02 per unit of volatility. If you would invest 4,295 in Good Will Instrument on August 31, 2024 and sell it today you would earn a total of 20.00 from holding Good Will Instrument or generate 0.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chung Fu Tex International vs. Good Will Instrument
Performance |
| Timeline |
| Chung Fu Tex |
| Good Will Instrument |
Chung Fu and Good Will Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chung Fu and Good Will
The main advantage of trading using opposite Chung Fu and Good Will positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chung Fu position performs unexpectedly, Good Will 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 Good Will will offset losses from the drop in Good Will's long position.| Chung Fu vs. Chung Hung Steel | Chung Fu vs. Voltronic Power Technology | Chung Fu vs. Iron Force Industrial | Chung Fu vs. Chicony Power Technology |
| Good Will vs. Zippy Technology Corp | Good Will vs. Unitech Computer Co | Good Will vs. Chroma ATE | Good Will vs. Greatek Electronics |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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