Correlation Between Emerging Display and Chi Hua
Can any of the company-specific risk be diversified away by investing in both Emerging Display and Chi Hua 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 Emerging Display and Chi Hua into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Emerging Display Technologies and Chi Hua Fitness, you can compare the effects of market volatilities on Emerging Display and Chi Hua 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 Emerging Display with a short position of Chi Hua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerging Display and Chi Hua.
Diversification Opportunities for Emerging Display and Chi Hua
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Emerging and Chi is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Emerging Display Technologies and Chi Hua Fitness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chi Hua Fitness and Emerging Display 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 Emerging Display Technologies are associated (or correlated) with Chi Hua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chi Hua Fitness has no effect on the direction of Emerging Display i.e., Emerging Display and Chi Hua go up and down completely randomly.
Pair Corralation between Emerging Display and Chi Hua
Assuming the 90 days trading horizon Emerging Display Technologies is expected to generate 3.31 times more return on investment than Chi Hua. However, Emerging Display is 3.31 times more volatile than Chi Hua Fitness. It trades about 0.08 of its potential returns per unit of risk. Chi Hua Fitness is currently generating about -0.13 per unit of risk. If you would invest 2,615 in Emerging Display Technologies on October 22, 2024 and sell it today you would earn a total of 90.00 from holding Emerging Display Technologies or generate 3.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Emerging Display Technologies vs. Chi Hua Fitness
Performance |
| Timeline |
| Emerging Display Tec |
| Chi Hua Fitness |
Emerging Display and Chi Hua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Emerging Display and Chi Hua
The main advantage of trading using opposite Emerging Display and Chi Hua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Emerging Display position performs unexpectedly, Chi Hua 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 Chi Hua will offset losses from the drop in Chi Hua's long position.| Emerging Display vs. Phoenix Silicon International | Emerging Display vs. Double Bond Chemical | Emerging Display vs. Camellia Metal Co | Emerging Display vs. Qualipoly Chemical Corp |
| Chi Hua vs. U Media Communications | Chi Hua vs. Wonderful Hi Tech Co | Chi Hua vs. Emerging Display Technologies | Chi Hua vs. Loop Telecommunication International |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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