Correlation Between Sinbon Electronics and Tong Hsing
Can any of the company-specific risk be diversified away by investing in both Sinbon Electronics and Tong Hsing 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 Sinbon Electronics and Tong Hsing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sinbon Electronics Co and Tong Hsing Electronic, you can compare the effects of market volatilities on Sinbon Electronics and Tong Hsing 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 Sinbon Electronics with a short position of Tong Hsing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinbon Electronics and Tong Hsing.
Diversification Opportunities for Sinbon Electronics and Tong Hsing
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sinbon and Tong is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Sinbon Electronics Co and Tong Hsing Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tong Hsing Electronic and Sinbon 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 Sinbon Electronics Co are associated (or correlated) with Tong Hsing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tong Hsing Electronic has no effect on the direction of Sinbon Electronics i.e., Sinbon Electronics and Tong Hsing go up and down completely randomly.
Pair Corralation between Sinbon Electronics and Tong Hsing
Assuming the 90 days trading horizon Sinbon Electronics Co is expected to generate 0.75 times more return on investment than Tong Hsing. However, Sinbon Electronics Co is 1.33 times less risky than Tong Hsing. It trades about -0.02 of its potential returns per unit of risk. Tong Hsing Electronic is currently generating about -0.05 per unit of risk. If you would invest 31,350 in Sinbon Electronics Co on September 1, 2024 and sell it today you would lose (5,800) from holding Sinbon Electronics Co or give up 18.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sinbon Electronics Co vs. Tong Hsing Electronic
Performance |
| Timeline |
| Sinbon Electronics |
| Tong Hsing Electronic |
Sinbon Electronics and Tong Hsing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sinbon Electronics and Tong Hsing
The main advantage of trading using opposite Sinbon Electronics and Tong Hsing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sinbon Electronics position performs unexpectedly, Tong Hsing 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 Tong Hsing will offset losses from the drop in Tong Hsing's long position.| Sinbon Electronics vs. Delta Electronics | Sinbon Electronics vs. Novatek Microelectronics Corp | Sinbon Electronics vs. Tripod Technology Corp | Sinbon Electronics vs. BizLink Holding |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Stocks Directory Find actively traded stocks across global markets | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |