Correlation Between StShine Optical and Symtek Automation
Can any of the company-specific risk be diversified away by investing in both StShine Optical and Symtek Automation 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 Symtek Automation 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 Symtek Automation Asia, you can compare the effects of market volatilities on StShine Optical and Symtek Automation 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 Symtek Automation. Check out your portfolio center. Please also check ongoing floating volatility patterns of StShine Optical and Symtek Automation.
Diversification Opportunities for StShine Optical and Symtek Automation
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between StShine and Symtek is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding StShine Optical Co and Symtek Automation Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Symtek Automation Asia 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 Symtek Automation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Symtek Automation Asia has no effect on the direction of StShine Optical i.e., StShine Optical and Symtek Automation go up and down completely randomly.
Pair Corralation between StShine Optical and Symtek Automation
Assuming the 90 days trading horizon StShine Optical is expected to generate 4.52 times less return on investment than Symtek Automation. But when comparing it to its historical volatility, StShine Optical Co is 1.93 times less risky than Symtek Automation. It trades about 0.05 of its potential returns per unit of risk. Symtek Automation Asia is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 10,096 in Symtek Automation Asia on August 29, 2024 and sell it today you would earn a total of 11,654 from holding Symtek Automation Asia or generate 115.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
StShine Optical Co vs. Symtek Automation Asia
Performance |
| Timeline |
| StShine Optical |
| Symtek Automation Asia |
StShine Optical and Symtek Automation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with StShine Optical and Symtek Automation
The main advantage of trading using opposite StShine Optical and Symtek Automation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if StShine Optical position performs unexpectedly, Symtek Automation 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 Symtek Automation will offset losses from the drop in Symtek Automation's long position.| StShine Optical vs. Sinphar Pharmaceutical Co | StShine Optical vs. Grape King Bio | StShine Optical vs. Apex Biotechnology Corp | StShine Optical vs. Leatec Fine Ceramics |
| Symtek Automation vs. Foxsemicon Integrated Technology | Symtek Automation vs. United Integrated Services | Symtek Automation vs. Ennostar | Symtek Automation vs. All Ring Tech |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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