Correlation Between Chaintech Technology and Cub Elecparts
Can any of the company-specific risk be diversified away by investing in both Chaintech Technology and Cub Elecparts 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 Chaintech Technology and Cub Elecparts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chaintech Technology Corp and Cub Elecparts, you can compare the effects of market volatilities on Chaintech Technology and Cub Elecparts 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 Chaintech Technology with a short position of Cub Elecparts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chaintech Technology and Cub Elecparts.
Diversification Opportunities for Chaintech Technology and Cub Elecparts
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Chaintech and Cub is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Chaintech Technology Corp and Cub Elecparts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cub Elecparts and Chaintech Technology 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 Chaintech Technology Corp are associated (or correlated) with Cub Elecparts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cub Elecparts has no effect on the direction of Chaintech Technology i.e., Chaintech Technology and Cub Elecparts go up and down completely randomly.
Pair Corralation between Chaintech Technology and Cub Elecparts
Assuming the 90 days trading horizon Chaintech Technology Corp is expected to generate 1.59 times more return on investment than Cub Elecparts. However, Chaintech Technology is 1.59 times more volatile than Cub Elecparts. It trades about 0.0 of its potential returns per unit of risk. Cub Elecparts is currently generating about -0.09 per unit of risk. If you would invest 4,070 in Chaintech Technology Corp on September 3, 2024 and sell it today you would lose (325.00) from holding Chaintech Technology Corp or give up 7.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chaintech Technology Corp vs. Cub Elecparts
Performance |
| Timeline |
| Chaintech Technology Corp |
| Cub Elecparts |
Chaintech Technology and Cub Elecparts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chaintech Technology and Cub Elecparts
The main advantage of trading using opposite Chaintech Technology and Cub Elecparts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chaintech Technology position performs unexpectedly, Cub Elecparts 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 Cub Elecparts will offset losses from the drop in Cub Elecparts' long position.| Chaintech Technology vs. Taiwan Semiconductor Manufacturing | Chaintech Technology vs. Yang Ming Marine | Chaintech Technology vs. ASE Industrial Holding | Chaintech Technology vs. AU Optronics |
| Cub Elecparts vs. Hota Industrial Mfg | Cub Elecparts vs. Eclat Textile Co | Cub Elecparts vs. Makalot Industrial Co | Cub Elecparts vs. King Slide Works |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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