Correlation Between Yuan Jen and Pan Jit
Can any of the company-specific risk be diversified away by investing in both Yuan Jen and Pan Jit 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 Yuan Jen and Pan Jit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yuan Jen Enterprises and Pan Jit International, you can compare the effects of market volatilities on Yuan Jen and Pan Jit 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 Yuan Jen with a short position of Pan Jit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuan Jen and Pan Jit.
Diversification Opportunities for Yuan Jen and Pan Jit
Poor diversification
The 3 months correlation between Yuan and Pan is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Yuan Jen Enterprises and Pan Jit International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pan Jit International and Yuan Jen 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 Yuan Jen Enterprises are associated (or correlated) with Pan Jit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pan Jit International has no effect on the direction of Yuan Jen i.e., Yuan Jen and Pan Jit go up and down completely randomly.
Pair Corralation between Yuan Jen and Pan Jit
Assuming the 90 days trading horizon Yuan Jen Enterprises is expected to under-perform the Pan Jit. In addition to that, Yuan Jen is 1.32 times more volatile than Pan Jit International. It trades about -0.35 of its total potential returns per unit of risk. Pan Jit International is currently generating about -0.15 per unit of volatility. If you would invest 5,270 in Pan Jit International on October 26, 2024 and sell it today you would lose (460.00) from holding Pan Jit International or give up 8.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yuan Jen Enterprises vs. Pan Jit International
Performance |
| Timeline |
| Yuan Jen Enterprises |
| Pan Jit International |
Yuan Jen and Pan Jit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yuan Jen and Pan Jit
The main advantage of trading using opposite Yuan Jen and Pan Jit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuan Jen position performs unexpectedly, Pan Jit 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 Pan Jit will offset losses from the drop in Pan Jit's long position.| Yuan Jen vs. China Man Made Fiber | Yuan Jen vs. Sinon Corp | Yuan Jen vs. Formosan Union Chemical | Yuan Jen vs. Maywufa Co |
| Pan Jit vs. Elan Microelectronics Corp | Pan Jit vs. Walsin Technology Corp | Pan Jit vs. Unimicron Technology Corp | Pan Jit vs. Visual Photonics Epitaxy |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |