Correlation Between Holy Stone and Emerging Display
Can any of the company-specific risk be diversified away by investing in both Holy Stone and Emerging Display 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 Holy Stone and Emerging Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Holy Stone Enterprise and Emerging Display Technologies, you can compare the effects of market volatilities on Holy Stone and Emerging Display 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 Holy Stone with a short position of Emerging Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Holy Stone and Emerging Display.
Diversification Opportunities for Holy Stone and Emerging Display
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Holy and Emerging is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Holy Stone Enterprise and Emerging Display Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerging Display Tec and Holy Stone 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 Holy Stone Enterprise are associated (or correlated) with Emerging Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerging Display Tec has no effect on the direction of Holy Stone i.e., Holy Stone and Emerging Display go up and down completely randomly.
Pair Corralation between Holy Stone and Emerging Display
Assuming the 90 days trading horizon Holy Stone Enterprise is expected to under-perform the Emerging Display. But the stock apears to be less risky and, when comparing its historical volatility, Holy Stone Enterprise is 2.84 times less risky than Emerging Display. The stock trades about -0.21 of its potential returns per unit of risk. The Emerging Display Technologies is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 2,735 in Emerging Display Technologies on October 10, 2024 and sell it today you would lose (5.00) from holding Emerging Display Technologies or give up 0.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Holy Stone Enterprise vs. Emerging Display Technologies
Performance |
| Timeline |
| Holy Stone Enterprise |
| Emerging Display Tec |
Holy Stone and Emerging Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Holy Stone and Emerging Display
The main advantage of trading using opposite Holy Stone and Emerging Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Holy Stone position performs unexpectedly, Emerging Display 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 Emerging Display will offset losses from the drop in Emerging Display's long position.| Holy Stone vs. Walsin Technology Corp | Holy Stone vs. Yageo Corp | Holy Stone vs. Tripod Technology Corp | Holy Stone vs. Asia Optical Co |
| Emerging Display vs. SciVision Biotech | Emerging Display vs. Wei Chuan Foods | Emerging Display vs. An Shin Food Services | Emerging Display vs. GeneReach Biotechnology |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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