Correlation Between Feng Ching and GAME HOURS
Can any of the company-specific risk be diversified away by investing in both Feng Ching and GAME HOURS 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 Feng Ching and GAME HOURS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Feng Ching Metal and GAME HOURS, you can compare the effects of market volatilities on Feng Ching and GAME HOURS 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 Feng Ching with a short position of GAME HOURS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Feng Ching and GAME HOURS.
Diversification Opportunities for Feng Ching and GAME HOURS
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Feng and GAME is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Feng Ching Metal and GAME HOURS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GAME HOURS and Feng Ching 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 Feng Ching Metal are associated (or correlated) with GAME HOURS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GAME HOURS has no effect on the direction of Feng Ching i.e., Feng Ching and GAME HOURS go up and down completely randomly.
Pair Corralation between Feng Ching and GAME HOURS
Assuming the 90 days trading horizon Feng Ching Metal is expected to under-perform the GAME HOURS. But the stock apears to be less risky and, when comparing its historical volatility, Feng Ching Metal is 1.7 times less risky than GAME HOURS. The stock trades about -0.05 of its potential returns per unit of risk. The GAME HOURS is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 715.00 in GAME HOURS on September 2, 2024 and sell it today you would lose (18.00) from holding GAME HOURS or give up 2.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Feng Ching Metal vs. GAME HOURS
Performance |
| Timeline |
| Feng Ching Metal |
| GAME HOURS |
Feng Ching and GAME HOURS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Feng Ching and GAME HOURS
The main advantage of trading using opposite Feng Ching and GAME HOURS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Feng Ching position performs unexpectedly, GAME HOURS 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 GAME HOURS will offset losses from the drop in GAME HOURS's long position.| Feng Ching vs. Walsin Lihwa Corp | Feng Ching vs. Voltronic Power Technology | Feng Ching vs. Advanced Energy Solution | Feng Ching vs. Simplo Technology Co |
| GAME HOURS vs. Gamania Digital Entertainment | GAME HOURS vs. Soft World International | GAME HOURS vs. X Legend Entertainment Co | GAME HOURS vs. Userjoy Technology 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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