Correlation Between Huaku Development and Symtek Automation
Can any of the company-specific risk be diversified away by investing in both Huaku Development and Symtek Automation 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 Huaku Development and Symtek Automation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Huaku Development Co and Symtek Automation Asia, you can compare the effects of market volatilities on Huaku Development and Symtek Automation 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 Huaku Development with a short position of Symtek Automation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huaku Development and Symtek Automation.
Diversification Opportunities for Huaku Development and Symtek Automation
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Huaku and Symtek is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Huaku Development Co and Symtek Automation Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Symtek Automation Asia and Huaku Development 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 Huaku Development Co are associated (or correlated) with Symtek Automation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Symtek Automation Asia has no effect on the direction of Huaku Development i.e., Huaku Development and Symtek Automation go up and down completely randomly.
Pair Corralation between Huaku Development and Symtek Automation
Assuming the 90 days trading horizon Huaku Development is expected to generate 2.73 times less return on investment than Symtek Automation. But when comparing it to its historical volatility, Huaku Development Co is 1.23 times less risky than Symtek Automation. It trades about 0.04 of its potential returns per unit of risk. Symtek Automation Asia is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 8,006 in Symtek Automation Asia on September 4, 2024 and sell it today you would earn a total of 12,594 from holding Symtek Automation Asia or generate 157.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huaku Development Co vs. Symtek Automation Asia
Performance |
| Timeline |
| Huaku Development |
| Symtek Automation Asia |
Huaku Development and Symtek Automation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huaku Development and Symtek Automation
The main advantage of trading using opposite Huaku Development and Symtek Automation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huaku Development position performs unexpectedly, Symtek Automation 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 Symtek Automation will offset losses from the drop in Symtek Automation's long position.| Huaku Development vs. Chong Hong Construction | Huaku Development vs. Highwealth Construction Corp | Huaku Development vs. Fubon Financial Holding | Huaku Development vs. CTBC Financial Holding |
| Symtek Automation vs. Foxsemicon Integrated Technology | Symtek Automation vs. United Integrated Services | Symtek Automation vs. Ennostar | Symtek Automation vs. All Ring Tech |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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