Correlation Between Wisher Industrial and Taisun Enterprise
Can any of the company-specific risk be diversified away by investing in both Wisher Industrial and Taisun Enterprise 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 Wisher Industrial and Taisun Enterprise into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wisher Industrial Co and Taisun Enterprise Co, you can compare the effects of market volatilities on Wisher Industrial and Taisun Enterprise 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 Wisher Industrial with a short position of Taisun Enterprise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wisher Industrial and Taisun Enterprise.
Diversification Opportunities for Wisher Industrial and Taisun Enterprise
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wisher and Taisun is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Wisher Industrial Co and Taisun Enterprise Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taisun Enterprise and Wisher Industrial 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 Wisher Industrial Co are associated (or correlated) with Taisun Enterprise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taisun Enterprise has no effect on the direction of Wisher Industrial i.e., Wisher Industrial and Taisun Enterprise go up and down completely randomly.
Pair Corralation between Wisher Industrial and Taisun Enterprise
Assuming the 90 days trading horizon Wisher Industrial Co is expected to generate 0.64 times more return on investment than Taisun Enterprise. However, Wisher Industrial Co is 1.56 times less risky than Taisun Enterprise. It trades about 0.02 of its potential returns per unit of risk. Taisun Enterprise Co is currently generating about -0.05 per unit of risk. If you would invest 1,341 in Wisher Industrial Co on November 27, 2024 and sell it today you would earn a total of 64.00 from holding Wisher Industrial Co or generate 4.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.78% |
| Values | Daily Returns |
Wisher Industrial Co vs. Taisun Enterprise Co
Performance |
| Timeline |
| Wisher Industrial |
| Taisun Enterprise |
Wisher Industrial and Taisun Enterprise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wisher Industrial and Taisun Enterprise
The main advantage of trading using opposite Wisher Industrial and Taisun Enterprise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wisher Industrial position performs unexpectedly, Taisun Enterprise 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 Taisun Enterprise will offset losses from the drop in Taisun Enterprise's long position.| Wisher Industrial vs. De Licacy Industrial | Wisher Industrial vs. Nien Hsing Textile | Wisher Industrial vs. Tainan Enterprises Co | Wisher Industrial vs. Tex Ray Industrial Co |
| Taisun Enterprise vs. AGV Products Corp | Taisun Enterprise vs. Wei Chuan Foods | Taisun Enterprise vs. Chia Hsin Cement | Taisun Enterprise vs. Grand Pacific Petrochemical |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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