Correlation Between Clevo and Ruentex Industries
Can any of the company-specific risk be diversified away by investing in both Clevo and Ruentex Industries 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 Clevo and Ruentex Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clevo Co and Ruentex Industries, you can compare the effects of market volatilities on Clevo and Ruentex Industries 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 Clevo with a short position of Ruentex Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clevo and Ruentex Industries.
Diversification Opportunities for Clevo and Ruentex Industries
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Clevo and Ruentex is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Clevo Co and Ruentex Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ruentex Industries and Clevo 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 Clevo Co are associated (or correlated) with Ruentex Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ruentex Industries has no effect on the direction of Clevo i.e., Clevo and Ruentex Industries go up and down completely randomly.
Pair Corralation between Clevo and Ruentex Industries
Assuming the 90 days trading horizon Clevo Co is expected to under-perform the Ruentex Industries. In addition to that, Clevo is 1.2 times more volatile than Ruentex Industries. It trades about -0.03 of its total potential returns per unit of risk. Ruentex Industries is currently generating about 0.04 per unit of volatility. If you would invest 7,630 in Ruentex Industries on August 31, 2024 and sell it today you would earn a total of 90.00 from holding Ruentex Industries or generate 1.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clevo Co vs. Ruentex Industries
Performance |
| Timeline |
| Clevo |
| Ruentex Industries |
Clevo and Ruentex Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clevo and Ruentex Industries
The main advantage of trading using opposite Clevo and Ruentex Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clevo position performs unexpectedly, Ruentex Industries 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 Ruentex Industries will offset losses from the drop in Ruentex Industries' long position.| Clevo vs. United Microelectronics | Clevo vs. Winbond Electronics Corp | Clevo vs. Macronix International Co |
| Ruentex Industries vs. Chaintech Technology Corp | Ruentex Industries vs. AVerMedia Technologies | Ruentex Industries vs. Avision | Ruentex Industries vs. Clevo 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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