Correlation Between Yi Jinn and Chyang Sheng
Can any of the company-specific risk be diversified away by investing in both Yi Jinn and Chyang 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 Yi Jinn and Chyang Sheng into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yi Jinn Industrial and Chyang Sheng Dyeing, you can compare the effects of market volatilities on Yi Jinn and Chyang 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 Yi Jinn with a short position of Chyang Sheng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yi Jinn and Chyang Sheng.
Diversification Opportunities for Yi Jinn and Chyang Sheng
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between 1457 and Chyang is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Yi Jinn Industrial and Chyang Sheng Dyeing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chyang Sheng Dyeing and Yi Jinn 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 Yi Jinn Industrial are associated (or correlated) with Chyang Sheng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chyang Sheng Dyeing has no effect on the direction of Yi Jinn i.e., Yi Jinn and Chyang Sheng go up and down completely randomly.
Pair Corralation between Yi Jinn and Chyang Sheng
Assuming the 90 days trading horizon Yi Jinn is expected to generate 2.0 times less return on investment than Chyang Sheng. But when comparing it to its historical volatility, Yi Jinn Industrial is 1.55 times less risky than Chyang Sheng. It trades about 0.06 of its potential returns per unit of risk. Chyang Sheng Dyeing is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 2,445 in Chyang Sheng Dyeing on September 2, 2024 and sell it today you would earn a total of 50.00 from holding Chyang Sheng Dyeing or generate 2.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yi Jinn Industrial vs. Chyang Sheng Dyeing
Performance |
| Timeline |
| Yi Jinn Industrial |
| Chyang Sheng Dyeing |
Yi Jinn and Chyang Sheng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yi Jinn and Chyang Sheng
The main advantage of trading using opposite Yi Jinn and Chyang Sheng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yi Jinn position performs unexpectedly, Chyang 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 Chyang Sheng will offset losses from the drop in Chyang Sheng's long position.| Yi Jinn vs. Chaintech Technology Corp | Yi Jinn vs. Avision | Yi Jinn vs. Clevo Co | Yi Jinn vs. Elitegroup Computer Systems |
| Chyang Sheng vs. Chaintech Technology Corp | Chyang Sheng vs. Avision | Chyang Sheng vs. Clevo Co | Chyang Sheng 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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