Correlation Between Sunnic Technology and Ma Kuang
Can any of the company-specific risk be diversified away by investing in both Sunnic Technology and Ma Kuang 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 Sunnic Technology and Ma Kuang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sunnic Technology Merchandise and Ma Kuang Healthcare, you can compare the effects of market volatilities on Sunnic Technology and Ma Kuang 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 Sunnic Technology with a short position of Ma Kuang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunnic Technology and Ma Kuang.
Diversification Opportunities for Sunnic Technology and Ma Kuang
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sunnic and 4139 is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Sunnic Technology Merchandise and Ma Kuang Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ma Kuang Healthcare and Sunnic Technology 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 Sunnic Technology Merchandise are associated (or correlated) with Ma Kuang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ma Kuang Healthcare has no effect on the direction of Sunnic Technology i.e., Sunnic Technology and Ma Kuang go up and down completely randomly.
Pair Corralation between Sunnic Technology and Ma Kuang
Assuming the 90 days trading horizon Sunnic Technology Merchandise is expected to generate 1.84 times more return on investment than Ma Kuang. However, Sunnic Technology is 1.84 times more volatile than Ma Kuang Healthcare. It trades about 0.27 of its potential returns per unit of risk. Ma Kuang Healthcare is currently generating about -0.19 per unit of risk. If you would invest 1,345 in Sunnic Technology Merchandise on November 28, 2024 and sell it today you would earn a total of 115.00 from holding Sunnic Technology Merchandise or generate 8.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunnic Technology Merchandise vs. Ma Kuang Healthcare
Performance |
| Timeline |
| Sunnic Technology |
| Ma Kuang Healthcare |
Sunnic Technology and Ma Kuang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunnic Technology and Ma Kuang
The main advantage of trading using opposite Sunnic Technology and Ma Kuang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunnic Technology position performs unexpectedly, Ma Kuang 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 Ma Kuang will offset losses from the drop in Ma Kuang's long position.| Sunnic Technology vs. International CSRC Investment | Sunnic Technology vs. Farglory FTZ Investment | Sunnic Technology vs. Asia Metal Industries | Sunnic Technology vs. Taiwan Chinsan Electronic |
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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.
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