Correlation Between Sino Horizon and Ta Ya
Can any of the company-specific risk be diversified away by investing in both Sino Horizon and Ta Ya 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 Sino Horizon and Ta Ya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sino Horizon Holdings and Ta Ya Electric, you can compare the effects of market volatilities on Sino Horizon and Ta Ya 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 Sino Horizon with a short position of Ta Ya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sino Horizon and Ta Ya.
Diversification Opportunities for Sino Horizon and Ta Ya
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sino and 1609 is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Sino Horizon Holdings and Ta Ya Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ta Ya Electric and Sino Horizon 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 Sino Horizon Holdings are associated (or correlated) with Ta Ya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ta Ya Electric has no effect on the direction of Sino Horizon i.e., Sino Horizon and Ta Ya go up and down completely randomly.
Pair Corralation between Sino Horizon and Ta Ya
Assuming the 90 days trading horizon Sino Horizon Holdings is expected to generate 2.32 times more return on investment than Ta Ya. However, Sino Horizon is 2.32 times more volatile than Ta Ya Electric. It trades about 0.07 of its potential returns per unit of risk. Ta Ya Electric is currently generating about 0.04 per unit of risk. If you would invest 2,970 in Sino Horizon Holdings on September 1, 2024 and sell it today you would earn a total of 130.00 from holding Sino Horizon Holdings or generate 4.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sino Horizon Holdings vs. Ta Ya Electric
Performance |
| Timeline |
| Sino Horizon Holdings |
| Ta Ya Electric |
Sino Horizon and Ta Ya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sino Horizon and Ta Ya
The main advantage of trading using opposite Sino Horizon and Ta Ya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sino Horizon position performs unexpectedly, Ta Ya 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 Ta Ya will offset losses from the drop in Ta Ya's long position.| Sino Horizon vs. Kee Tai Properties | Sino Horizon vs. Hung Sheng Construction | Sino Horizon vs. BES Engineering Co | Sino Horizon vs. Chainqui Construction Development |
| Ta Ya vs. BES Engineering Co | Ta Ya vs. Continental Holdings Corp | Ta Ya vs. Kee Tai Properties | Ta Ya vs. Hung Sheng Construction |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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