Correlation Between Cheng Shin and Yeou Yih
Can any of the company-specific risk be diversified away by investing in both Cheng Shin and Yeou Yih 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 Cheng Shin and Yeou Yih into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cheng Shin Rubber and Yeou Yih Steel, you can compare the effects of market volatilities on Cheng Shin and Yeou Yih 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 Cheng Shin with a short position of Yeou Yih. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cheng Shin and Yeou Yih.
Diversification Opportunities for Cheng Shin and Yeou Yih
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Cheng and Yeou is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Cheng Shin Rubber and Yeou Yih Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yeou Yih Steel and Cheng Shin 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 Cheng Shin Rubber are associated (or correlated) with Yeou Yih. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yeou Yih Steel has no effect on the direction of Cheng Shin i.e., Cheng Shin and Yeou Yih go up and down completely randomly.
Pair Corralation between Cheng Shin and Yeou Yih
Assuming the 90 days trading horizon Cheng Shin Rubber is expected to generate 4.8 times more return on investment than Yeou Yih. However, Cheng Shin is 4.8 times more volatile than Yeou Yih Steel. It trades about 0.13 of its potential returns per unit of risk. Yeou Yih Steel is currently generating about -0.07 per unit of risk. If you would invest 4,640 in Cheng Shin Rubber on August 28, 2024 and sell it today you would earn a total of 380.00 from holding Cheng Shin Rubber or generate 8.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Cheng Shin Rubber vs. Yeou Yih Steel
Performance |
| Timeline |
| Cheng Shin Rubber |
| Yeou Yih Steel |
Cheng Shin and Yeou Yih Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cheng Shin and Yeou Yih
The main advantage of trading using opposite Cheng Shin and Yeou Yih positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cheng Shin position performs unexpectedly, Yeou Yih 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 Yeou Yih will offset losses from the drop in Yeou Yih's long position.| Cheng Shin vs. Uni President Enterprises Corp | Cheng Shin vs. Formosa Chemicals Fibre | Cheng Shin vs. Asia Cement Corp | Cheng Shin vs. Pou Chen Corp |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |