Correlation Between Hung Sheng and Ablerex Electronics
Can any of the company-specific risk be diversified away by investing in both Hung Sheng and Ablerex Electronics 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 Hung Sheng and Ablerex Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hung Sheng Construction and Ablerex Electronics Co, you can compare the effects of market volatilities on Hung Sheng and Ablerex Electronics 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 Hung Sheng with a short position of Ablerex Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hung Sheng and Ablerex Electronics.
Diversification Opportunities for Hung Sheng and Ablerex Electronics
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hung and Ablerex is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Hung Sheng Construction and Ablerex Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ablerex Electronics and Hung Sheng 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 Hung Sheng Construction are associated (or correlated) with Ablerex Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ablerex Electronics has no effect on the direction of Hung Sheng i.e., Hung Sheng and Ablerex Electronics go up and down completely randomly.
Pair Corralation between Hung Sheng and Ablerex Electronics
Assuming the 90 days trading horizon Hung Sheng Construction is expected to generate 1.0 times more return on investment than Ablerex Electronics. However, Hung Sheng Construction is 1.0 times less risky than Ablerex Electronics. It trades about 0.07 of its potential returns per unit of risk. Ablerex Electronics Co is currently generating about 0.03 per unit of risk. If you would invest 2,035 in Hung Sheng Construction on September 2, 2024 and sell it today you would earn a total of 660.00 from holding Hung Sheng Construction or generate 32.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hung Sheng Construction vs. Ablerex Electronics Co
Performance |
| Timeline |
| Hung Sheng Construction |
| Ablerex Electronics |
Hung Sheng and Ablerex Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hung Sheng and Ablerex Electronics
The main advantage of trading using opposite Hung Sheng and Ablerex Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hung Sheng position performs unexpectedly, Ablerex Electronics 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 Ablerex Electronics will offset losses from the drop in Ablerex Electronics' long position.| Hung Sheng vs. Chainqui Construction Development | Hung Sheng vs. Kee Tai Properties | Hung Sheng vs. BES Engineering Co | Hung Sheng vs. Zinwell |
| Ablerex Electronics vs. Hon Hai Precision | Ablerex Electronics vs. Delta Electronics | Ablerex Electronics vs. LARGAN Precision Co | Ablerex Electronics vs. Yageo Corp |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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