Correlation Between Catcher Technology and Senao Networks
Can any of the company-specific risk be diversified away by investing in both Catcher Technology and Senao Networks 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 Catcher Technology and Senao Networks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catcher Technology Co and Senao Networks, you can compare the effects of market volatilities on Catcher Technology and Senao Networks 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 Catcher Technology with a short position of Senao Networks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catcher Technology and Senao Networks.
Diversification Opportunities for Catcher Technology and Senao Networks
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Catcher and Senao is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Catcher Technology Co and Senao Networks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Senao Networks and Catcher 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 Catcher Technology Co are associated (or correlated) with Senao Networks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Senao Networks has no effect on the direction of Catcher Technology i.e., Catcher Technology and Senao Networks go up and down completely randomly.
Pair Corralation between Catcher Technology and Senao Networks
Assuming the 90 days trading horizon Catcher Technology Co is expected to under-perform the Senao Networks. But the stock apears to be less risky and, when comparing its historical volatility, Catcher Technology Co is 2.09 times less risky than Senao Networks. The stock trades about -0.42 of its potential returns per unit of risk. The Senao Networks is currently generating about 0.42 of returns per unit of risk over similar time horizon. If you would invest 14,200 in Senao Networks on September 1, 2024 and sell it today you would earn a total of 6,450 from holding Senao Networks or generate 45.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Catcher Technology Co vs. Senao Networks
Performance |
| Timeline |
| Catcher Technology |
| Senao Networks |
Catcher Technology and Senao Networks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catcher Technology and Senao Networks
The main advantage of trading using opposite Catcher Technology and Senao Networks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catcher Technology position performs unexpectedly, Senao Networks 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 Senao Networks will offset losses from the drop in Senao Networks' long position.| Catcher Technology vs. LARGAN Precision Co | Catcher Technology vs. Delta Electronics | Catcher Technology vs. Quanta Computer | Catcher Technology vs. Pegatron Corp |
| Senao Networks vs. Group Up Industrial | Senao Networks vs. Wiwynn Corp | Senao Networks vs. Senao International Co | Senao Networks vs. San Neng Group |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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