Correlation Between Chang Hwa and Hsin Ba
Can any of the company-specific risk be diversified away by investing in both Chang Hwa and Hsin Ba 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 Chang Hwa and Hsin Ba into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chang Hwa Commercial and Hsin Ba Ba, you can compare the effects of market volatilities on Chang Hwa and Hsin Ba 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 Chang Hwa with a short position of Hsin Ba. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chang Hwa and Hsin Ba.
Diversification Opportunities for Chang Hwa and Hsin Ba
Very good diversification
The 3 months correlation between Chang and Hsin is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Chang Hwa Commercial and Hsin Ba Ba in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hsin Ba Ba and Chang Hwa 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 Chang Hwa Commercial are associated (or correlated) with Hsin Ba. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hsin Ba Ba has no effect on the direction of Chang Hwa i.e., Chang Hwa and Hsin Ba go up and down completely randomly.
Pair Corralation between Chang Hwa and Hsin Ba
Assuming the 90 days trading horizon Chang Hwa Commercial is expected to under-perform the Hsin Ba. But the stock apears to be less risky and, when comparing its historical volatility, Chang Hwa Commercial is 7.04 times less risky than Hsin Ba. The stock trades about -0.11 of its potential returns per unit of risk. The Hsin Ba Ba is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 10,900 in Hsin Ba Ba on November 27, 2024 and sell it today you would earn a total of 1,000.00 from holding Hsin Ba Ba or generate 9.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.12% |
| Values | Daily Returns |
Chang Hwa Commercial vs. Hsin Ba Ba
Performance |
| Timeline |
| Chang Hwa Commercial |
| Hsin Ba Ba |
Chang Hwa and Hsin Ba Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chang Hwa and Hsin Ba
The main advantage of trading using opposite Chang Hwa and Hsin Ba positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chang Hwa position performs unexpectedly, Hsin Ba 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 Hsin Ba will offset losses from the drop in Hsin Ba's long position.| Chang Hwa vs. Hua Nan Financial | Chang Hwa vs. First Financial Holding | Chang Hwa vs. Sinopac Financial Holdings | Chang Hwa vs. Taishin Financial Holding |
| Hsin Ba vs. Great China Metal | Hsin Ba vs. Ton Yi Industrial | Hsin Ba vs. Ching Feng Home | Hsin Ba vs. Choice Development |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |