Correlation Between U Ming and Sinopac Financial
Can any of the company-specific risk be diversified away by investing in both U Ming and Sinopac Financial 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 U Ming and Sinopac Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between U Ming Marine Transport and Sinopac Financial Holdings, you can compare the effects of market volatilities on U Ming and Sinopac Financial 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 U Ming with a short position of Sinopac Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of U Ming and Sinopac Financial.
Diversification Opportunities for U Ming and Sinopac Financial
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 2606 and Sinopac is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding U Ming Marine Transport and Sinopac Financial Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinopac Financial and U Ming 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 U Ming Marine Transport are associated (or correlated) with Sinopac Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinopac Financial has no effect on the direction of U Ming i.e., U Ming and Sinopac Financial go up and down completely randomly.
Pair Corralation between U Ming and Sinopac Financial
Assuming the 90 days trading horizon U Ming Marine Transport is expected to generate 0.77 times more return on investment than Sinopac Financial. However, U Ming Marine Transport is 1.3 times less risky than Sinopac Financial. It trades about 0.13 of its potential returns per unit of risk. Sinopac Financial Holdings is currently generating about 0.04 per unit of risk. If you would invest 5,650 in U Ming Marine Transport on September 3, 2024 and sell it today you would earn a total of 200.00 from holding U Ming Marine Transport or generate 3.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
U Ming Marine Transport vs. Sinopac Financial Holdings
Performance |
| Timeline |
| U Ming Marine |
| Sinopac Financial |
U Ming and Sinopac Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with U Ming and Sinopac Financial
The main advantage of trading using opposite U Ming and Sinopac Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if U Ming position performs unexpectedly, Sinopac Financial 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 Sinopac Financial will offset losses from the drop in Sinopac Financial's long position.| U Ming vs. Universal Microelectronics Co | U Ming vs. AVerMedia Technologies | U Ming vs. Symtek Automation Asia | U Ming vs. WiseChip Semiconductor |
| Sinopac Financial vs. Central Reinsurance Corp | Sinopac Financial vs. Huaku Development Co | Sinopac Financial vs. Chailease Holding Co | Sinopac Financial vs. CTBC Financial Holding |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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