Correlation Between Hiwin Technologies and STL Technology
Can any of the company-specific risk be diversified away by investing in both Hiwin Technologies and STL Technology 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 Hiwin Technologies and STL Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hiwin Technologies Corp and STL Technology Co, you can compare the effects of market volatilities on Hiwin Technologies and STL Technology 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 Hiwin Technologies with a short position of STL Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hiwin Technologies and STL Technology.
Diversification Opportunities for Hiwin Technologies and STL Technology
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Hiwin and STL is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Hiwin Technologies Corp and STL Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STL Technology and Hiwin Technologies 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 Hiwin Technologies Corp are associated (or correlated) with STL Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STL Technology has no effect on the direction of Hiwin Technologies i.e., Hiwin Technologies and STL Technology go up and down completely randomly.
Pair Corralation between Hiwin Technologies and STL Technology
Assuming the 90 days trading horizon Hiwin Technologies is expected to generate 1.98 times less return on investment than STL Technology. But when comparing it to its historical volatility, Hiwin Technologies Corp is 1.3 times less risky than STL Technology. It trades about 0.03 of its potential returns per unit of risk. STL Technology Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 4,760 in STL Technology Co on November 2, 2024 and sell it today you would earn a total of 2,450 from holding STL Technology Co or generate 51.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hiwin Technologies Corp vs. STL Technology Co
Performance |
| Timeline |
| Hiwin Technologies Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
| STL Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Hiwin Technologies and STL Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hiwin Technologies and STL Technology
The main advantage of trading using opposite Hiwin Technologies and STL Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hiwin Technologies position performs unexpectedly, STL Technology 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 STL Technology will offset losses from the drop in STL Technology's long position.The idea behind Hiwin Technologies Corp and STL Technology Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |