Correlation Between Techshine Electronics and Fuzhou Rockchip
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By analyzing existing cross correlation between Techshine Electronics Co and Fuzhou Rockchip Electronics, you can compare the effects of market volatilities on Techshine Electronics and Fuzhou Rockchip 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 Techshine Electronics with a short position of Fuzhou Rockchip. Check out your portfolio center. Please also check ongoing floating volatility patterns of Techshine Electronics and Fuzhou Rockchip.
Diversification Opportunities for Techshine Electronics and Fuzhou Rockchip
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Techshine and Fuzhou is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Techshine Electronics Co and Fuzhou Rockchip Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fuzhou Rockchip Elec and Techshine Electronics 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 Techshine Electronics Co are associated (or correlated) with Fuzhou Rockchip. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fuzhou Rockchip Elec has no effect on the direction of Techshine Electronics i.e., Techshine Electronics and Fuzhou Rockchip go up and down completely randomly.
Pair Corralation between Techshine Electronics and Fuzhou Rockchip
Assuming the 90 days trading horizon Techshine Electronics is expected to generate 4.53 times less return on investment than Fuzhou Rockchip. But when comparing it to its historical volatility, Techshine Electronics Co is 2.19 times less risky than Fuzhou Rockchip. It trades about 0.3 of its potential returns per unit of risk. Fuzhou Rockchip Electronics is currently generating about 0.63 of returns per unit of risk over similar time horizon. If you would invest 10,788 in Fuzhou Rockchip Electronics on November 8, 2024 and sell it today you would earn a total of 7,864 from holding Fuzhou Rockchip Electronics or generate 72.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Techshine Electronics Co vs. Fuzhou Rockchip Electronics
Performance |
| Timeline |
| Techshine Electronics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
| Fuzhou Rockchip Elec |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
Techshine Electronics and Fuzhou Rockchip Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Techshine Electronics and Fuzhou Rockchip
The main advantage of trading using opposite Techshine Electronics and Fuzhou Rockchip positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Techshine Electronics position performs unexpectedly, Fuzhou Rockchip 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 Fuzhou Rockchip will offset losses from the drop in Fuzhou Rockchip's long position.The idea behind Techshine Electronics Co and Fuzhou Rockchip Electronics pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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