Correlation Between Camellia Metal and Sirtec International
Can any of the company-specific risk be diversified away by investing in both Camellia Metal and Sirtec International 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 Camellia Metal and Sirtec International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Camellia Metal Co and Sirtec International Co, you can compare the effects of market volatilities on Camellia Metal and Sirtec International 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 Camellia Metal with a short position of Sirtec International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Camellia Metal and Sirtec International.
Diversification Opportunities for Camellia Metal and Sirtec International
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Camellia and Sirtec is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Camellia Metal Co and Sirtec International Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sirtec International and Camellia Metal 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 Camellia Metal Co are associated (or correlated) with Sirtec International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sirtec International has no effect on the direction of Camellia Metal i.e., Camellia Metal and Sirtec International go up and down completely randomly.
Pair Corralation between Camellia Metal and Sirtec International
Assuming the 90 days trading horizon Camellia Metal Co is expected to generate 1.15 times more return on investment than Sirtec International. However, Camellia Metal is 1.15 times more volatile than Sirtec International Co. It trades about 0.06 of its potential returns per unit of risk. Sirtec International Co is currently generating about -0.25 per unit of risk. If you would invest 1,470 in Camellia Metal Co on October 23, 2024 and sell it today you would earn a total of 40.00 from holding Camellia Metal Co or generate 2.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.62% |
| Values | Daily Returns |
Camellia Metal Co vs. Sirtec International Co
Performance |
| Timeline |
| Camellia Metal |
| Sirtec International |
Camellia Metal and Sirtec International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Camellia Metal and Sirtec International
The main advantage of trading using opposite Camellia Metal and Sirtec International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Camellia Metal position performs unexpectedly, Sirtec International 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 Sirtec International will offset losses from the drop in Sirtec International's long position.| Camellia Metal vs. Healthconn Corp | Camellia Metal vs. Yuan High Tech Development | Camellia Metal vs. Wholetech System Hitech | Camellia Metal vs. SS Healthcare Holding |
| Sirtec International vs. Camellia Metal Co | Sirtec International vs. Asia Metal Industries | Sirtec International vs. Shinkong Insurance Co | Sirtec International vs. First Hotel 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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