Correlation Between Sinkang Industries and YC Inox
Can any of the company-specific risk be diversified away by investing in both Sinkang Industries and YC Inox 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 Sinkang Industries and YC Inox into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sinkang Industries Co and YC Inox Co, you can compare the effects of market volatilities on Sinkang Industries and YC Inox 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 Sinkang Industries with a short position of YC Inox. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinkang Industries and YC Inox.
Diversification Opportunities for Sinkang Industries and YC Inox
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sinkang and 2034 is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Sinkang Industries Co and YC Inox Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YC Inox and Sinkang Industries 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 Sinkang Industries Co are associated (or correlated) with YC Inox. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YC Inox has no effect on the direction of Sinkang Industries i.e., Sinkang Industries and YC Inox go up and down completely randomly.
Pair Corralation between Sinkang Industries and YC Inox
Assuming the 90 days trading horizon Sinkang Industries Co is expected to under-perform the YC Inox. But the stock apears to be less risky and, when comparing its historical volatility, Sinkang Industries Co is 1.86 times less risky than YC Inox. The stock trades about -0.24 of its potential returns per unit of risk. The YC Inox Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,050 in YC Inox Co on September 12, 2024 and sell it today you would earn a total of 25.00 from holding YC Inox Co or generate 1.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sinkang Industries Co vs. YC Inox Co
Performance |
| Timeline |
| Sinkang Industries |
| YC Inox |
Sinkang Industries and YC Inox Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sinkang Industries and YC Inox
The main advantage of trading using opposite Sinkang Industries and YC Inox positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sinkang Industries position performs unexpectedly, YC Inox 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 YC Inox will offset losses from the drop in YC Inox's long position.| Sinkang Industries vs. YC Inox Co | Sinkang Industries vs. Ta Chen Stainless | Sinkang Industries vs. Froch Enterprise Co | Sinkang Industries vs. Chung Hung Steel |
| YC Inox vs. Tainan Spinning Co | YC Inox vs. Lealea Enterprise Co | YC Inox vs. China Petrochemical Development | YC Inox vs. Ruentex Development 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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