Correlation Between Cuckoo Electronics and Haitai Confectionery
Can any of the company-specific risk be diversified away by investing in both Cuckoo Electronics and Haitai Confectionery 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 Cuckoo Electronics and Haitai Confectionery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cuckoo Electronics Co and Haitai Confectionery Foods, you can compare the effects of market volatilities on Cuckoo Electronics and Haitai Confectionery 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 Cuckoo Electronics with a short position of Haitai Confectionery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cuckoo Electronics and Haitai Confectionery.
Diversification Opportunities for Cuckoo Electronics and Haitai Confectionery
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cuckoo and Haitai is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Cuckoo Electronics Co and Haitai Confectionery Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haitai Confectionery and Cuckoo Electronics 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 Cuckoo Electronics Co are associated (or correlated) with Haitai Confectionery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haitai Confectionery has no effect on the direction of Cuckoo Electronics i.e., Cuckoo Electronics and Haitai Confectionery go up and down completely randomly.
Pair Corralation between Cuckoo Electronics and Haitai Confectionery
Assuming the 90 days trading horizon Cuckoo Electronics Co is expected to generate 0.56 times more return on investment than Haitai Confectionery. However, Cuckoo Electronics Co is 1.79 times less risky than Haitai Confectionery. It trades about 0.11 of its potential returns per unit of risk. Haitai Confectionery Foods is currently generating about 0.04 per unit of risk. If you would invest 1,543,665 in Cuckoo Electronics Co on August 29, 2024 and sell it today you would earn a total of 726,335 from holding Cuckoo Electronics Co or generate 47.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cuckoo Electronics Co vs. Haitai Confectionery Foods
Performance |
| Timeline |
| Cuckoo Electronics |
| Haitai Confectionery |
Cuckoo Electronics and Haitai Confectionery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cuckoo Electronics and Haitai Confectionery
The main advantage of trading using opposite Cuckoo Electronics and Haitai Confectionery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cuckoo Electronics position performs unexpectedly, Haitai Confectionery 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 Haitai Confectionery will offset losses from the drop in Haitai Confectionery's long position.| Cuckoo Electronics vs. KMH Hitech Co | Cuckoo Electronics vs. GemVaxKAEL CoLtd | Cuckoo Electronics vs. Busan Industrial Co | Cuckoo Electronics vs. Busan Ind |
| Haitai Confectionery vs. WooDeumGee Farm Co, | Haitai Confectionery vs. Wireless Power Amplifier | Haitai Confectionery vs. Miwon Chemicals Co | Haitai Confectionery vs. Playgram Co |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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