Correlation Between Chi Hua and ANJI Technology
Can any of the company-specific risk be diversified away by investing in both Chi Hua and ANJI Technology 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 ANJI Technology 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 ANJI Technology Co, you can compare the effects of market volatilities on Chi Hua and ANJI Technology 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 ANJI Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chi Hua and ANJI Technology.
Diversification Opportunities for Chi Hua and ANJI Technology
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Chi and ANJI is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Chi Hua Fitness and ANJI Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANJI Technology 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 ANJI Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANJI Technology has no effect on the direction of Chi Hua i.e., Chi Hua and ANJI Technology go up and down completely randomly.
Pair Corralation between Chi Hua and ANJI Technology
Assuming the 90 days trading horizon Chi Hua Fitness is expected to under-perform the ANJI Technology. But the stock apears to be less risky and, when comparing its historical volatility, Chi Hua Fitness is 1.82 times less risky than ANJI Technology. The stock trades about -0.12 of its potential returns per unit of risk. The ANJI Technology Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 3,900 in ANJI Technology Co on October 28, 2024 and sell it today you would earn a total of 70.00 from holding ANJI Technology Co or generate 1.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chi Hua Fitness vs. ANJI Technology Co
Performance |
| Timeline |
| Chi Hua Fitness |
| ANJI Technology |
Chi Hua and ANJI Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chi Hua and ANJI Technology
The main advantage of trading using opposite Chi Hua and ANJI Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chi Hua position performs unexpectedly, ANJI Technology 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 ANJI Technology will offset losses from the drop in ANJI Technology's long position.| Chi Hua vs. Sunny Friend Environmental | Chi Hua vs. Cleanaway Co | Chi Hua vs. Charoen Pokphand Enterprise | Chi Hua vs. TTET Union Corp |
| ANJI Technology vs. Unimicron Technology Corp | ANJI Technology vs. Kinsus Interconnect Technology | ANJI Technology vs. Novatek Microelectronics Corp | ANJI Technology vs. Delta Electronics |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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