Correlation Between Chaintech Technology and Roo Hsing
Can any of the company-specific risk be diversified away by investing in both Chaintech Technology and Roo Hsing 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 Roo Hsing 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 Roo Hsing Co, you can compare the effects of market volatilities on Chaintech Technology and Roo Hsing 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 Roo Hsing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chaintech Technology and Roo Hsing.
Diversification Opportunities for Chaintech Technology and Roo Hsing
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Chaintech and Roo is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Chaintech Technology Corp and Roo Hsing Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Roo Hsing 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 Roo Hsing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Roo Hsing has no effect on the direction of Chaintech Technology i.e., Chaintech Technology and Roo Hsing go up and down completely randomly.
Pair Corralation between Chaintech Technology and Roo Hsing
Assuming the 90 days trading horizon Chaintech Technology Corp is expected to under-perform the Roo Hsing. In addition to that, Chaintech Technology is 1.41 times more volatile than Roo Hsing Co. It trades about -0.01 of its total potential returns per unit of risk. Roo Hsing Co is currently generating about 0.02 per unit of volatility. If you would invest 309.00 in Roo Hsing Co on September 2, 2024 and sell it today you would earn a total of 7.00 from holding Roo Hsing Co or generate 2.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chaintech Technology Corp vs. Roo Hsing Co
Performance |
| Timeline |
| Chaintech Technology Corp |
| Roo Hsing |
Chaintech Technology and Roo Hsing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chaintech Technology and Roo Hsing
The main advantage of trading using opposite Chaintech Technology and Roo Hsing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chaintech Technology position performs unexpectedly, Roo Hsing 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 Roo Hsing will offset losses from the drop in Roo Hsing's long position.| Chaintech Technology vs. Biostar Microtech International | Chaintech Technology vs. Elitegroup Computer Systems | Chaintech Technology vs. Shuttle | Chaintech Technology vs. Gigabyte Technology Co |
| Roo Hsing vs. Chaintech Technology Corp | Roo Hsing vs. Avision | Roo Hsing vs. Clevo Co | Roo Hsing vs. Elitegroup Computer Systems |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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