Correlation Between Tang Eng and HOYA Resort
Can any of the company-specific risk be diversified away by investing in both Tang Eng and HOYA Resort 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 Tang Eng and HOYA Resort into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tang Eng Iron and HOYA Resort Hotel, you can compare the effects of market volatilities on Tang Eng and HOYA Resort 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 Tang Eng with a short position of HOYA Resort. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tang Eng and HOYA Resort.
Diversification Opportunities for Tang Eng and HOYA Resort
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Tang and HOYA is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Tang Eng Iron and HOYA Resort Hotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HOYA Resort Hotel and Tang Eng 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 Tang Eng Iron are associated (or correlated) with HOYA Resort. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HOYA Resort Hotel has no effect on the direction of Tang Eng i.e., Tang Eng and HOYA Resort go up and down completely randomly.
Pair Corralation between Tang Eng and HOYA Resort
Assuming the 90 days trading horizon Tang Eng Iron is expected to generate 0.6 times more return on investment than HOYA Resort. However, Tang Eng Iron is 1.66 times less risky than HOYA Resort. It trades about 0.05 of its potential returns per unit of risk. HOYA Resort Hotel is currently generating about -0.33 per unit of risk. If you would invest 3,285 in Tang Eng Iron on September 1, 2024 and sell it today you would earn a total of 30.00 from holding Tang Eng Iron or generate 0.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tang Eng Iron vs. HOYA Resort Hotel
Performance |
| Timeline |
| Tang Eng Iron |
| HOYA Resort Hotel |
Tang Eng and HOYA Resort Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tang Eng and HOYA Resort
The main advantage of trading using opposite Tang Eng and HOYA Resort positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tang Eng position performs unexpectedly, HOYA Resort 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 HOYA Resort will offset losses from the drop in HOYA Resort's long position.| Tang Eng vs. Basso Industry Corp | Tang Eng vs. Chung Hsin Electric Machinery | Tang Eng vs. TYC Brother Industrial | Tang Eng vs. TECO Electric Machinery |
| HOYA Resort vs. AVerMedia Technologies | HOYA Resort vs. Cayenne Entertainment Technology | HOYA Resort vs. Sports Gear Co | HOYA Resort vs. Provision Information CoLtd |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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