Correlation Between Jentech Precision and Shin Ruenn
Can any of the company-specific risk be diversified away by investing in both Jentech Precision and Shin Ruenn 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 Ruenn 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 Ruenn Development, you can compare the effects of market volatilities on Jentech Precision and Shin Ruenn 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 Ruenn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jentech Precision and Shin Ruenn.
Diversification Opportunities for Jentech Precision and Shin Ruenn
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Jentech and Shin is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Jentech Precision Industrial and Shin Ruenn Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shin Ruenn Development 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 Ruenn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shin Ruenn Development has no effect on the direction of Jentech Precision i.e., Jentech Precision and Shin Ruenn go up and down completely randomly.
Pair Corralation between Jentech Precision and Shin Ruenn
Assuming the 90 days trading horizon Jentech Precision Industrial is expected to generate 1.35 times more return on investment than Shin Ruenn. However, Jentech Precision is 1.35 times more volatile than Shin Ruenn Development. It trades about 0.1 of its potential returns per unit of risk. Shin Ruenn Development is currently generating about 0.07 per unit of risk. If you would invest 38,750 in Jentech Precision Industrial on August 30, 2024 and sell it today you would earn a total of 95,250 from holding Jentech Precision Industrial or generate 245.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jentech Precision Industrial vs. Shin Ruenn Development
Performance |
| Timeline |
| Jentech Precision |
| Shin Ruenn Development |
Jentech Precision and Shin Ruenn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jentech Precision and Shin Ruenn
The main advantage of trading using opposite Jentech Precision and Shin Ruenn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jentech Precision position performs unexpectedly, Shin Ruenn 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 Ruenn will offset losses from the drop in Shin Ruenn'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 Ruenn vs. Highwealth Construction Corp | Shin Ruenn vs. Kunyue Development Co | Shin Ruenn vs. Leatec Fine Ceramics | Shin Ruenn vs. Information Technology Total |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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