Correlation Between Jentech Precision and Shin Zu
Can any of the company-specific risk be diversified away by investing in both Jentech Precision and Shin Zu 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 Jentech Precision and Shin Zu into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jentech Precision Industrial and Shin Zu Shing, you can compare the effects of market volatilities on Jentech Precision and Shin Zu 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 Jentech Precision with a short position of Shin Zu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jentech Precision and Shin Zu.
Diversification Opportunities for Jentech Precision and Shin Zu
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Jentech and Shin is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Jentech Precision Industrial and Shin Zu Shing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shin Zu Shing and Jentech Precision 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 Jentech Precision Industrial are associated (or correlated) with Shin Zu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shin Zu Shing has no effect on the direction of Jentech Precision i.e., Jentech Precision and Shin Zu go up and down completely randomly.
Pair Corralation between Jentech Precision and Shin Zu
Assuming the 90 days trading horizon Jentech Precision Industrial is expected to generate 0.94 times more return on investment than Shin Zu. However, Jentech Precision Industrial is 1.06 times less risky than Shin Zu. It trades about 0.09 of its potential returns per unit of risk. Shin Zu Shing is currently generating about 0.04 per unit of risk. If you would invest 89,600 in Jentech Precision Industrial on October 12, 2024 and sell it today you would earn a total of 55,900 from holding Jentech Precision Industrial or generate 62.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jentech Precision Industrial vs. Shin Zu Shing
Performance |
| Timeline |
| Jentech Precision |
| Shin Zu Shing |
Jentech Precision and Shin Zu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jentech Precision and Shin Zu
The main advantage of trading using opposite Jentech Precision and Shin Zu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jentech Precision position performs unexpectedly, Shin Zu 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 Shin Zu will offset losses from the drop in Shin Zu's long position.| Jentech Precision vs. Lotes Co | Jentech Precision vs. Nan Ya Printed | Jentech Precision vs. Global Unichip Corp | Jentech Precision vs. Tong Hsing Electronic |
| Shin Zu vs. Catcher Technology Co | Shin Zu vs. Tripod Technology Corp | Shin Zu vs. Chicony Electronics Co | Shin Zu vs. Kinsus Interconnect Technology |
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.
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