Correlation Between Wisher Industrial and Shieh Yih
Can any of the company-specific risk be diversified away by investing in both Wisher Industrial and Shieh Yih 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 Shieh Yih 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 Shieh Yih Machinery, you can compare the effects of market volatilities on Wisher Industrial and Shieh Yih 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 Shieh Yih. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wisher Industrial and Shieh Yih.
Diversification Opportunities for Wisher Industrial and Shieh Yih
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wisher and Shieh is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Wisher Industrial Co and Shieh Yih Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shieh Yih Machinery 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 Shieh Yih. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shieh Yih Machinery has no effect on the direction of Wisher Industrial i.e., Wisher Industrial and Shieh Yih go up and down completely randomly.
Pair Corralation between Wisher Industrial and Shieh Yih
Assuming the 90 days trading horizon Wisher Industrial is expected to generate 5.28 times less return on investment than Shieh Yih. But when comparing it to its historical volatility, Wisher Industrial Co is 3.73 times less risky than Shieh Yih. It trades about 0.03 of its potential returns per unit of risk. Shieh Yih Machinery is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,871 in Shieh Yih Machinery on August 28, 2024 and sell it today you would earn a total of 944.00 from holding Shieh Yih Machinery or generate 32.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.71% |
| Values | Daily Returns |
Wisher Industrial Co vs. Shieh Yih Machinery
Performance |
| Timeline |
| Wisher Industrial |
| Shieh Yih Machinery |
Wisher Industrial and Shieh Yih Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wisher Industrial and Shieh Yih
The main advantage of trading using opposite Wisher Industrial and Shieh Yih positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wisher Industrial position performs unexpectedly, Shieh Yih 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 Shieh Yih will offset losses from the drop in Shieh Yih's long position.| Wisher Industrial vs. Taiwan Semiconductor Manufacturing | Wisher Industrial vs. Hon Hai Precision | Wisher Industrial vs. MediaTek | Wisher Industrial vs. Chunghwa Telecom Co |
| Shieh Yih vs. Sunny Friend Environmental | Shieh Yih vs. TTET Union Corp | Shieh Yih vs. ECOVE Environment Corp | Shieh Yih vs. Yulon Finance 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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