Correlation Between EMemory Technology and Hung Ching
Can any of the company-specific risk be diversified away by investing in both EMemory Technology and Hung Ching 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 EMemory Technology and Hung Ching into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between eMemory Technology and Hung Ching Development, you can compare the effects of market volatilities on EMemory Technology and Hung Ching 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 EMemory Technology with a short position of Hung Ching. Check out your portfolio center. Please also check ongoing floating volatility patterns of EMemory Technology and Hung Ching.
Diversification Opportunities for EMemory Technology and Hung Ching
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between EMemory and Hung is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding eMemory Technology and Hung Ching Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hung Ching Development and EMemory 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 eMemory Technology are associated (or correlated) with Hung Ching. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hung Ching Development has no effect on the direction of EMemory Technology i.e., EMemory Technology and Hung Ching go up and down completely randomly.
Pair Corralation between EMemory Technology and Hung Ching
Assuming the 90 days trading horizon eMemory Technology is expected to generate 1.22 times more return on investment than Hung Ching. However, EMemory Technology is 1.22 times more volatile than Hung Ching Development. It trades about 0.06 of its potential returns per unit of risk. Hung Ching Development is currently generating about 0.07 per unit of risk. If you would invest 309,500 in eMemory Technology on October 26, 2024 and sell it today you would earn a total of 28,500 from holding eMemory Technology or generate 9.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
eMemory Technology vs. Hung Ching Development
Performance |
| Timeline |
| eMemory Technology |
| Hung Ching Development |
EMemory Technology and Hung Ching Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EMemory Technology and Hung Ching
The main advantage of trading using opposite EMemory Technology and Hung Ching positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EMemory Technology position performs unexpectedly, Hung Ching 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 Hung Ching will offset losses from the drop in Hung Ching's long position.| EMemory Technology vs. Nan Ya Printed | EMemory Technology vs. Global Unichip Corp | EMemory Technology vs. Aspeed Technology | EMemory Technology vs. Alchip Technologies |
| Hung Ching vs. Hung Sheng Construction | Hung Ching vs. Kindom Construction Corp | Hung Ching vs. Kee Tai Properties | Hung Ching vs. Delpha Construction Co |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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