Correlation Between Chiu Ting and Li Kang
Can any of the company-specific risk be diversified away by investing in both Chiu Ting and Li Kang 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 Chiu Ting and Li Kang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chiu Ting Machinery and Li Kang Biomedical, you can compare the effects of market volatilities on Chiu Ting and Li Kang 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 Chiu Ting with a short position of Li Kang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chiu Ting and Li Kang.
Diversification Opportunities for Chiu Ting and Li Kang
Average diversification
The 3 months correlation between Chiu and 6242 is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Chiu Ting Machinery and Li Kang Biomedical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Li Kang Biomedical and Chiu Ting 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 Chiu Ting Machinery are associated (or correlated) with Li Kang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Li Kang Biomedical has no effect on the direction of Chiu Ting i.e., Chiu Ting and Li Kang go up and down completely randomly.
Pair Corralation between Chiu Ting and Li Kang
Assuming the 90 days trading horizon Chiu Ting Machinery is expected to generate 4.47 times more return on investment than Li Kang. However, Chiu Ting is 4.47 times more volatile than Li Kang Biomedical. It trades about 0.04 of its potential returns per unit of risk. Li Kang Biomedical is currently generating about -0.02 per unit of risk. If you would invest 2,435 in Chiu Ting Machinery on August 28, 2024 and sell it today you would earn a total of 125.00 from holding Chiu Ting Machinery or generate 5.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chiu Ting Machinery vs. Li Kang Biomedical
Performance |
| Timeline |
| Chiu Ting Machinery |
| Li Kang Biomedical |
Chiu Ting and Li Kang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chiu Ting and Li Kang
The main advantage of trading using opposite Chiu Ting and Li Kang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chiu Ting position performs unexpectedly, Li Kang 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 Li Kang will offset losses from the drop in Li Kang's long position.| Chiu Ting vs. Sunny Friend Environmental | Chiu Ting vs. TTET Union Corp | Chiu Ting vs. ECOVE Environment Corp | Chiu Ting vs. Yulon Finance Corp |
| Li Kang vs. Taiwan Cement Corp | Li Kang vs. Ruentex Development Co | Li Kang vs. Symtek Automation Asia | Li Kang vs. CTCI 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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |