Correlation Between Chi Hua and Winstek Semiconductor
Can any of the company-specific risk be diversified away by investing in both Chi Hua and Winstek Semiconductor 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 Chi Hua and Winstek Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chi Hua Fitness and Winstek Semiconductor Co, you can compare the effects of market volatilities on Chi Hua and Winstek Semiconductor 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 Chi Hua with a short position of Winstek Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chi Hua and Winstek Semiconductor.
Diversification Opportunities for Chi Hua and Winstek Semiconductor
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Chi and Winstek is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Chi Hua Fitness and Winstek Semiconductor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Winstek Semiconductor and Chi Hua 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 Chi Hua Fitness are associated (or correlated) with Winstek Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Winstek Semiconductor has no effect on the direction of Chi Hua i.e., Chi Hua and Winstek Semiconductor go up and down completely randomly.
Pair Corralation between Chi Hua and Winstek Semiconductor
Assuming the 90 days trading horizon Chi Hua Fitness is expected to under-perform the Winstek Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Chi Hua Fitness is 2.26 times less risky than Winstek Semiconductor. The stock trades about -0.32 of its potential returns per unit of risk. The Winstek Semiconductor Co is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 11,200 in Winstek Semiconductor Co on October 11, 2024 and sell it today you would earn a total of 100.00 from holding Winstek Semiconductor Co or generate 0.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chi Hua Fitness vs. Winstek Semiconductor Co
Performance |
| Timeline |
| Chi Hua Fitness |
| Winstek Semiconductor |
Chi Hua and Winstek Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chi Hua and Winstek Semiconductor
The main advantage of trading using opposite Chi Hua and Winstek Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chi Hua position performs unexpectedly, Winstek Semiconductor 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 Winstek Semiconductor will offset losses from the drop in Winstek Semiconductor's long position.| Chi Hua vs. Jinan Acetate Chemical | Chi Hua vs. X Legend Entertainment Co | Chi Hua vs. Li Kang Biomedical | Chi Hua vs. Prime Oil Chemical |
| Winstek Semiconductor vs. Pacific Hospital Supply | Winstek Semiconductor vs. Chi Hua Fitness | Winstek Semiconductor vs. SS Healthcare Holding | Winstek Semiconductor vs. Onyx Healthcare |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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