Correlation Between Sunko Ink and Cheng Shin
Can any of the company-specific risk be diversified away by investing in both Sunko Ink and Cheng Shin 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 Sunko Ink and Cheng Shin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sunko Ink Co and Cheng Shin Rubber, you can compare the effects of market volatilities on Sunko Ink and Cheng Shin 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 Sunko Ink with a short position of Cheng Shin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunko Ink and Cheng Shin.
Diversification Opportunities for Sunko Ink and Cheng Shin
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sunko and Cheng is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Sunko Ink Co and Cheng Shin Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheng Shin Rubber and Sunko Ink 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 Sunko Ink Co are associated (or correlated) with Cheng Shin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheng Shin Rubber has no effect on the direction of Sunko Ink i.e., Sunko Ink and Cheng Shin go up and down completely randomly.
Pair Corralation between Sunko Ink and Cheng Shin
Assuming the 90 days trading horizon Sunko Ink Co is expected to under-perform the Cheng Shin. In addition to that, Sunko Ink is 1.53 times more volatile than Cheng Shin Rubber. It trades about -0.02 of its total potential returns per unit of risk. Cheng Shin Rubber is currently generating about 0.04 per unit of volatility. If you would invest 3,750 in Cheng Shin Rubber on January 16, 2025 and sell it today you would earn a total of 1,075 from holding Cheng Shin Rubber or generate 28.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunko Ink Co vs. Cheng Shin Rubber
Performance |
| Timeline |
| Sunko Ink |
| Cheng Shin Rubber |
Sunko Ink and Cheng Shin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunko Ink and Cheng Shin
The main advantage of trading using opposite Sunko Ink and Cheng Shin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunko Ink position performs unexpectedly, Cheng Shin 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 Cheng Shin will offset losses from the drop in Cheng Shin's long position.| Sunko Ink vs. Everlight Chemical Industrial | Sunko Ink vs. China Man Made Fiber | Sunko Ink vs. Tex Ray Industrial Co | Sunko Ink vs. Ho Tung Chemical |
| Cheng Shin vs. Uni President Enterprises Corp | Cheng Shin vs. Formosa Chemicals Fibre | Cheng Shin vs. Asia Cement Corp | Cheng Shin vs. Pou Chen 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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