Correlation Between Newretail and Hi Lai
Can any of the company-specific risk be diversified away by investing in both Newretail and Hi Lai 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 Newretail and Hi Lai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Newretail Co and Hi Lai Foods Co, you can compare the effects of market volatilities on Newretail and Hi Lai 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 Newretail with a short position of Hi Lai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newretail and Hi Lai.
Diversification Opportunities for Newretail and Hi Lai
Pay attention - limited upside
The 3 months correlation between Newretail and 1268 is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Newretail Co and Hi Lai Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hi Lai Foods and Newretail 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 Newretail Co are associated (or correlated) with Hi Lai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hi Lai Foods has no effect on the direction of Newretail i.e., Newretail and Hi Lai go up and down completely randomly.
Pair Corralation between Newretail and Hi Lai
Assuming the 90 days trading horizon Newretail Co is expected to generate 2.09 times more return on investment than Hi Lai. However, Newretail is 2.09 times more volatile than Hi Lai Foods Co. It trades about 0.25 of its potential returns per unit of risk. Hi Lai Foods Co is currently generating about 0.08 per unit of risk. If you would invest 2,400 in Newretail Co on October 22, 2024 and sell it today you would earn a total of 220.00 from holding Newretail Co or generate 9.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Newretail Co vs. Hi Lai Foods Co
Performance |
| Timeline |
| Newretail |
| Hi Lai Foods |
Newretail and Hi Lai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newretail and Hi Lai
The main advantage of trading using opposite Newretail and Hi Lai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newretail position performs unexpectedly, Hi Lai 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 Hi Lai will offset losses from the drop in Hi Lai's long position.| Newretail vs. Est Global Apparel | Newretail vs. Fubon Taiwan Technology | Newretail vs. Cleanaway Co | Newretail vs. Genovate Biotechnology Co |
| Hi Lai vs. Union Insurance Co | Hi Lai vs. Chailease Holding Co | Hi Lai vs. Newretail Co | Hi Lai vs. Mercuries Life Insurance |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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