Correlation Between Gigastorage Corp and Chenming Mold
Can any of the company-specific risk be diversified away by investing in both Gigastorage Corp and Chenming Mold 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 Gigastorage Corp and Chenming Mold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gigastorage Corp and Chenming Mold Industrial, you can compare the effects of market volatilities on Gigastorage Corp and Chenming Mold 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 Gigastorage Corp with a short position of Chenming Mold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gigastorage Corp and Chenming Mold.
Diversification Opportunities for Gigastorage Corp and Chenming Mold
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Gigastorage and Chenming is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Gigastorage Corp and Chenming Mold Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chenming Mold Industrial and Gigastorage Corp 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 Gigastorage Corp are associated (or correlated) with Chenming Mold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chenming Mold Industrial has no effect on the direction of Gigastorage Corp i.e., Gigastorage Corp and Chenming Mold go up and down completely randomly.
Pair Corralation between Gigastorage Corp and Chenming Mold
Assuming the 90 days trading horizon Gigastorage Corp is expected to generate 0.55 times more return on investment than Chenming Mold. However, Gigastorage Corp is 1.82 times less risky than Chenming Mold. It trades about -0.07 of its potential returns per unit of risk. Chenming Mold Industrial is currently generating about -0.04 per unit of risk. If you would invest 1,845 in Gigastorage Corp on August 28, 2024 and sell it today you would lose (60.00) from holding Gigastorage Corp or give up 3.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gigastorage Corp vs. Chenming Mold Industrial
Performance |
| Timeline |
| Gigastorage Corp |
| Chenming Mold Industrial |
Gigastorage Corp and Chenming Mold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gigastorage Corp and Chenming Mold
The main advantage of trading using opposite Gigastorage Corp and Chenming Mold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gigastorage Corp position performs unexpectedly, Chenming Mold 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 Chenming Mold will offset losses from the drop in Chenming Mold's long position.| Gigastorage Corp vs. Chernan Metal Industrial | Gigastorage Corp vs. Chung Hwa Chemical | Gigastorage Corp vs. Dadi Early Childhood Education | Gigastorage Corp vs. Chi Sheng Chemical |
| Chenming Mold vs. Clevo Co | Chenming Mold vs. Zinwell | Chenming Mold vs. Min Aik Technology | Chenming Mold vs. Promise Technology |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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