Correlation Between De Licacy and Shinkong Textile
Can any of the company-specific risk be diversified away by investing in both De Licacy and Shinkong Textile 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 De Licacy and Shinkong Textile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between De Licacy Industrial and Shinkong Textile Co, you can compare the effects of market volatilities on De Licacy and Shinkong Textile 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 De Licacy with a short position of Shinkong Textile. Check out your portfolio center. Please also check ongoing floating volatility patterns of De Licacy and Shinkong Textile.
Diversification Opportunities for De Licacy and Shinkong Textile
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 1464 and Shinkong is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding De Licacy Industrial and Shinkong Textile Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinkong Textile and De Licacy 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 De Licacy Industrial are associated (or correlated) with Shinkong Textile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinkong Textile has no effect on the direction of De Licacy i.e., De Licacy and Shinkong Textile go up and down completely randomly.
Pair Corralation between De Licacy and Shinkong Textile
Assuming the 90 days trading horizon De Licacy Industrial is expected to generate 2.35 times more return on investment than Shinkong Textile. However, De Licacy is 2.35 times more volatile than Shinkong Textile Co. It trades about 0.01 of its potential returns per unit of risk. Shinkong Textile Co is currently generating about 0.0 per unit of risk. If you would invest 1,620 in De Licacy Industrial on September 5, 2024 and sell it today you would lose (5.00) from holding De Licacy Industrial or give up 0.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
De Licacy Industrial vs. Shinkong Textile Co
Performance |
| Timeline |
| De Licacy Industrial |
| Shinkong Textile |
De Licacy and Shinkong Textile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with De Licacy and Shinkong Textile
The main advantage of trading using opposite De Licacy and Shinkong Textile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if De Licacy position performs unexpectedly, Shinkong Textile 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 Shinkong Textile will offset losses from the drop in Shinkong Textile's long position.| De Licacy vs. Tainan Enterprises Co | De Licacy vs. Nien Hsing Textile | De Licacy vs. Wisher Industrial Co | De Licacy vs. Tex Ray Industrial Co |
| Shinkong Textile vs. Tainan Spinning Co | Shinkong Textile vs. Chia Her Industrial | Shinkong Textile vs. WiseChip Semiconductor | Shinkong Textile vs. Novatek Microelectronics Corp |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |