Correlation Between Chia Her and Zig Sheng
Can any of the company-specific risk be diversified away by investing in both Chia Her and Zig Sheng 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 Chia Her and Zig Sheng into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chia Her Industrial and Zig Sheng Industrial, you can compare the effects of market volatilities on Chia Her and Zig Sheng 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 Chia Her with a short position of Zig Sheng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chia Her and Zig Sheng.
Diversification Opportunities for Chia Her and Zig Sheng
Pay attention - limited upside
The 3 months correlation between Chia and Zig is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Chia Her Industrial and Zig Sheng Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zig Sheng Industrial and Chia Her 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 Chia Her Industrial are associated (or correlated) with Zig Sheng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zig Sheng Industrial has no effect on the direction of Chia Her i.e., Chia Her and Zig Sheng go up and down completely randomly.
Pair Corralation between Chia Her and Zig Sheng
Assuming the 90 days trading horizon Chia Her Industrial is expected to generate 7.23 times more return on investment than Zig Sheng. However, Chia Her is 7.23 times more volatile than Zig Sheng Industrial. It trades about 0.01 of its potential returns per unit of risk. Zig Sheng Industrial is currently generating about -0.12 per unit of risk. If you would invest 2,685 in Chia Her Industrial on September 12, 2024 and sell it today you would lose (60.00) from holding Chia Her Industrial or give up 2.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chia Her Industrial vs. Zig Sheng Industrial
Performance |
| Timeline |
| Chia Her Industrial |
| Zig Sheng Industrial |
Chia Her and Zig Sheng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chia Her and Zig Sheng
The main advantage of trading using opposite Chia Her and Zig Sheng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chia Her position performs unexpectedly, Zig Sheng 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 Zig Sheng will offset losses from the drop in Zig Sheng's long position.| Chia Her vs. Feng Tay Enterprises | Chia Her vs. Ruentex Development Co | Chia Her vs. WiseChip Semiconductor | Chia Her vs. Novatek Microelectronics Corp |
| Zig Sheng vs. Lealea Enterprise Co | Zig Sheng vs. Tainan Spinning Co | Zig Sheng vs. Li Peng Enterprise | Zig Sheng vs. Shinkong Synthetic Fiber |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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