Correlation Between BizLink Holding and China Television
Can any of the company-specific risk be diversified away by investing in both BizLink Holding and China Television 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 BizLink Holding and China Television into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BizLink Holding and China Television Co, you can compare the effects of market volatilities on BizLink Holding and China Television 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 BizLink Holding with a short position of China Television. Check out your portfolio center. Please also check ongoing floating volatility patterns of BizLink Holding and China Television.
Diversification Opportunities for BizLink Holding and China Television
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BizLink and China is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding BizLink Holding and China Television Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Television and BizLink Holding 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 BizLink Holding are associated (or correlated) with China Television. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Television has no effect on the direction of BizLink Holding i.e., BizLink Holding and China Television go up and down completely randomly.
Pair Corralation between BizLink Holding and China Television
Assuming the 90 days trading horizon BizLink Holding is expected to generate 3.12 times more return on investment than China Television. However, BizLink Holding is 3.12 times more volatile than China Television Co. It trades about 0.1 of its potential returns per unit of risk. China Television Co is currently generating about -0.36 per unit of risk. If you would invest 60,200 in BizLink Holding on October 29, 2024 and sell it today you would earn a total of 3,500 from holding BizLink Holding or generate 5.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BizLink Holding vs. China Television Co
Performance |
| Timeline |
| BizLink Holding |
| China Television |
BizLink Holding and China Television Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BizLink Holding and China Television
The main advantage of trading using opposite BizLink Holding and China Television positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BizLink Holding position performs unexpectedly, China Television 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 China Television will offset losses from the drop in China Television's long position.| BizLink Holding vs. Hota Industrial Mfg | BizLink Holding vs. Chroma ATE | BizLink Holding vs. Sinbon Electronics Co | BizLink Holding vs. Tong Hsing Electronic |
| China Television vs. Ton Yi Industrial | China Television vs. Taiwan Sakura Corp | China Television vs. Thye Ming Industrial | China Television vs. Taiwan Fu Hsing |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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