Correlation Between StShine Optical and Easywell Biomedicals
Can any of the company-specific risk be diversified away by investing in both StShine Optical and Easywell Biomedicals 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 StShine Optical and Easywell Biomedicals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between StShine Optical Co and Easywell Biomedicals, you can compare the effects of market volatilities on StShine Optical and Easywell Biomedicals 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 StShine Optical with a short position of Easywell Biomedicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of StShine Optical and Easywell Biomedicals.
Diversification Opportunities for StShine Optical and Easywell Biomedicals
-0.93 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between StShine and Easywell is -0.93. Overlapping area represents the amount of risk that can be diversified away by holding StShine Optical Co and Easywell Biomedicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Easywell Biomedicals and StShine Optical 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 StShine Optical Co are associated (or correlated) with Easywell Biomedicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Easywell Biomedicals has no effect on the direction of StShine Optical i.e., StShine Optical and Easywell Biomedicals go up and down completely randomly.
Pair Corralation between StShine Optical and Easywell Biomedicals
Assuming the 90 days trading horizon StShine Optical is expected to generate 15.88 times less return on investment than Easywell Biomedicals. But when comparing it to its historical volatility, StShine Optical Co is 2.95 times less risky than Easywell Biomedicals. It trades about 0.02 of its potential returns per unit of risk. Easywell Biomedicals is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 2,255 in Easywell Biomedicals on September 4, 2024 and sell it today you would earn a total of 4,405 from holding Easywell Biomedicals or generate 195.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
StShine Optical Co vs. Easywell Biomedicals
Performance |
| Timeline |
| StShine Optical |
| Easywell Biomedicals |
StShine Optical and Easywell Biomedicals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with StShine Optical and Easywell Biomedicals
The main advantage of trading using opposite StShine Optical and Easywell Biomedicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if StShine Optical position performs unexpectedly, Easywell Biomedicals 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 Easywell Biomedicals will offset losses from the drop in Easywell Biomedicals' long position.| StShine Optical vs. Landis Taipei Hotel | StShine Optical vs. Oceanic Beverages Co | StShine Optical vs. Far EasTone Telecommunications | StShine Optical vs. Ambassador Hotel |
| Easywell Biomedicals vs. Chien Kuo Construction | Easywell Biomedicals vs. PChome Online | Easywell Biomedicals vs. Pacific Construction Co | Easywell Biomedicals vs. Goldsun Building Materials |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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