Correlation Between Materials Analysis and Cheng Mei
Can any of the company-specific risk be diversified away by investing in both Materials Analysis and Cheng Mei 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 Materials Analysis and Cheng Mei into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Materials Analysis Technology and Cheng Mei Materials, you can compare the effects of market volatilities on Materials Analysis and Cheng Mei 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 Materials Analysis with a short position of Cheng Mei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Materials Analysis and Cheng Mei.
Diversification Opportunities for Materials Analysis and Cheng Mei
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Materials and Cheng is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Materials Analysis Technology and Cheng Mei Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheng Mei Materials and Materials Analysis 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 Materials Analysis Technology are associated (or correlated) with Cheng Mei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheng Mei Materials has no effect on the direction of Materials Analysis i.e., Materials Analysis and Cheng Mei go up and down completely randomly.
Pair Corralation between Materials Analysis and Cheng Mei
Assuming the 90 days trading horizon Materials Analysis Technology is expected to generate 0.99 times more return on investment than Cheng Mei. However, Materials Analysis Technology is 1.01 times less risky than Cheng Mei. It trades about 0.0 of its potential returns per unit of risk. Cheng Mei Materials is currently generating about -0.01 per unit of risk. If you would invest 25,800 in Materials Analysis Technology on October 13, 2024 and sell it today you would lose (850.00) from holding Materials Analysis Technology or give up 3.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Materials Analysis Technology vs. Cheng Mei Materials
Performance |
| Timeline |
| Materials Analysis |
| Cheng Mei Materials |
Materials Analysis and Cheng Mei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Materials Analysis and Cheng Mei
The main advantage of trading using opposite Materials Analysis and Cheng Mei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Materials Analysis position performs unexpectedly, Cheng Mei 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 Cheng Mei will offset losses from the drop in Cheng Mei's long position.| Materials Analysis vs. Integrated Service Technology | Materials Analysis vs. ASE Industrial Holding | Materials Analysis vs. Gudeng Precision Industrial | Materials Analysis vs. eMemory Technology |
| Cheng Mei vs. Holy Stone Enterprise | Cheng Mei vs. Walsin Technology Corp | Cheng Mei vs. Yageo Corp | Cheng Mei vs. HannStar Board 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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