Correlation Between Shin Zu and BES Engineering
Can any of the company-specific risk be diversified away by investing in both Shin Zu and BES Engineering 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 Shin Zu and BES Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shin Zu Shing and BES Engineering Co, you can compare the effects of market volatilities on Shin Zu and BES Engineering 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 Shin Zu with a short position of BES Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shin Zu and BES Engineering.
Diversification Opportunities for Shin Zu and BES Engineering
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shin and BES is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Shin Zu Shing and BES Engineering Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BES Engineering and Shin Zu 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 Shin Zu Shing are associated (or correlated) with BES Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BES Engineering has no effect on the direction of Shin Zu i.e., Shin Zu and BES Engineering go up and down completely randomly.
Pair Corralation between Shin Zu and BES Engineering
Assuming the 90 days trading horizon Shin Zu Shing is expected to generate 1.41 times more return on investment than BES Engineering. However, Shin Zu is 1.41 times more volatile than BES Engineering Co. It trades about 0.08 of its potential returns per unit of risk. BES Engineering Co is currently generating about 0.04 per unit of risk. If you would invest 8,122 in Shin Zu Shing on September 2, 2024 and sell it today you would earn a total of 11,228 from holding Shin Zu Shing or generate 138.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.79% |
| Values | Daily Returns |
Shin Zu Shing vs. BES Engineering Co
Performance |
| Timeline |
| Shin Zu Shing |
| BES Engineering |
Shin Zu and BES Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shin Zu and BES Engineering
The main advantage of trading using opposite Shin Zu and BES Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shin Zu position performs unexpectedly, BES Engineering 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 BES Engineering will offset losses from the drop in BES Engineering's long position.| Shin Zu vs. Catcher Technology Co | Shin Zu vs. Tripod Technology Corp | Shin Zu vs. Chicony Electronics Co | Shin Zu vs. Kinsus Interconnect Technology |
| BES Engineering vs. Hung Sheng Construction | BES Engineering vs. Taiwan Glass Ind | BES Engineering vs. China Petrochemical Development | BES Engineering vs. Taiwan Tea Corp |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |