Correlation Between Huang Hsiang and Strong H
Can any of the company-specific risk be diversified away by investing in both Huang Hsiang and Strong H 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 Huang Hsiang and Strong H into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Huang Hsiang Construction and Strong H Machinery, you can compare the effects of market volatilities on Huang Hsiang and Strong H 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 Huang Hsiang with a short position of Strong H. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huang Hsiang and Strong H.
Diversification Opportunities for Huang Hsiang and Strong H
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Huang and Strong is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Huang Hsiang Construction and Strong H Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strong H Machinery and Huang Hsiang 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 Huang Hsiang Construction are associated (or correlated) with Strong H. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strong H Machinery has no effect on the direction of Huang Hsiang i.e., Huang Hsiang and Strong H go up and down completely randomly.
Pair Corralation between Huang Hsiang and Strong H
Assuming the 90 days trading horizon Huang Hsiang is expected to generate 1.75 times less return on investment than Strong H. In addition to that, Huang Hsiang is 2.58 times more volatile than Strong H Machinery. It trades about 0.04 of its total potential returns per unit of risk. Strong H Machinery is currently generating about 0.18 per unit of volatility. If you would invest 3,205 in Strong H Machinery on September 13, 2024 and sell it today you would earn a total of 410.00 from holding Strong H Machinery or generate 12.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huang Hsiang Construction vs. Strong H Machinery
Performance |
| Timeline |
| Huang Hsiang Construction |
| Strong H Machinery |
Huang Hsiang and Strong H Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huang Hsiang and Strong H
The main advantage of trading using opposite Huang Hsiang and Strong H positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huang Hsiang position performs unexpectedly, Strong H 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 Strong H will offset losses from the drop in Strong H's long position.| Huang Hsiang vs. Chong Hong Construction | Huang Hsiang vs. Ruentex Development Co | Huang Hsiang vs. Symtek Automation Asia | Huang Hsiang vs. WiseChip Semiconductor |
| Strong H vs. Hiwin Mikrosystem Corp | Strong H vs. Ruentex Development Co | Strong H vs. Symtek Automation Asia | Strong H vs. WiseChip Semiconductor |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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