Correlation Between Shin Kong and Anpec Electronics
Can any of the company-specific risk be diversified away by investing in both Shin Kong and Anpec Electronics 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 Shin Kong and Anpec Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shin Kong Financial and Anpec Electronics, you can compare the effects of market volatilities on Shin Kong and Anpec Electronics 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 Shin Kong with a short position of Anpec Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shin Kong and Anpec Electronics.
Diversification Opportunities for Shin Kong and Anpec Electronics
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shin and Anpec is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Shin Kong Financial and Anpec Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anpec Electronics and Shin Kong 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 Shin Kong Financial are associated (or correlated) with Anpec Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anpec Electronics has no effect on the direction of Shin Kong i.e., Shin Kong and Anpec Electronics go up and down completely randomly.
Pair Corralation between Shin Kong and Anpec Electronics
Assuming the 90 days trading horizon Shin Kong Financial is expected to generate 0.25 times more return on investment than Anpec Electronics. However, Shin Kong Financial is 3.96 times less risky than Anpec Electronics. It trades about 0.16 of its potential returns per unit of risk. Anpec Electronics is currently generating about -0.37 per unit of risk. If you would invest 1,145 in Shin Kong Financial on August 26, 2024 and sell it today you would earn a total of 25.00 from holding Shin Kong Financial or generate 2.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shin Kong Financial vs. Anpec Electronics
Performance |
| Timeline |
| Shin Kong Financial |
| Anpec Electronics |
Shin Kong and Anpec Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shin Kong and Anpec Electronics
The main advantage of trading using opposite Shin Kong and Anpec Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shin Kong position performs unexpectedly, Anpec Electronics 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 Anpec Electronics will offset losses from the drop in Anpec Electronics' long position.| Shin Kong vs. Cathay Financial Holding | Shin Kong vs. Taishin Financial Holding | Shin Kong vs. Fubon Financial Holding | Shin Kong vs. CTBC Financial Holding |
| Anpec Electronics vs. Global Unichip Corp | Anpec Electronics vs. Asmedia Technology | Anpec Electronics vs. Unimicron Technology Corp | Anpec Electronics vs. Novatek Microelectronics Corp |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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