Correlation Between CG Hi and Bosung Power
Can any of the company-specific risk be diversified away by investing in both CG Hi and Bosung Power 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 CG Hi and Bosung Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CG Hi Tech and Bosung Power Technology, you can compare the effects of market volatilities on CG Hi and Bosung Power 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 CG Hi with a short position of Bosung Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of CG Hi and Bosung Power.
Diversification Opportunities for CG Hi and Bosung Power
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 264660 and Bosung is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding CG Hi Tech and Bosung Power Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bosung Power Technology and CG Hi 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 CG Hi Tech are associated (or correlated) with Bosung Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bosung Power Technology has no effect on the direction of CG Hi i.e., CG Hi and Bosung Power go up and down completely randomly.
Pair Corralation between CG Hi and Bosung Power
Assuming the 90 days trading horizon CG Hi Tech is expected to generate 4.16 times more return on investment than Bosung Power. However, CG Hi is 4.16 times more volatile than Bosung Power Technology. It trades about 0.25 of its potential returns per unit of risk. Bosung Power Technology is currently generating about -0.1 per unit of risk. If you would invest 1,072,000 in CG Hi Tech on December 5, 2024 and sell it today you would earn a total of 390,000 from holding CG Hi Tech or generate 36.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CG Hi Tech vs. Bosung Power Technology
Performance |
| Timeline |
| CG Hi Tech |
| Bosung Power Technology |
CG Hi and Bosung Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CG Hi and Bosung Power
The main advantage of trading using opposite CG Hi and Bosung Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CG Hi position performs unexpectedly, Bosung Power 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 Bosung Power will offset losses from the drop in Bosung Power's long position.| CG Hi vs. Alton Sports CoLtd | ||
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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