Correlation Between YungShin Global and Shiny Chemical
Can any of the company-specific risk be diversified away by investing in both YungShin Global and Shiny Chemical 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 YungShin Global and Shiny Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YungShin Global Holding and Shiny Chemical Industrial, you can compare the effects of market volatilities on YungShin Global and Shiny Chemical 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 YungShin Global with a short position of Shiny Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of YungShin Global and Shiny Chemical.
Diversification Opportunities for YungShin Global and Shiny Chemical
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between YungShin and Shiny is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding YungShin Global Holding and Shiny Chemical Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shiny Chemical Industrial and YungShin Global 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 YungShin Global Holding are associated (or correlated) with Shiny Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shiny Chemical Industrial has no effect on the direction of YungShin Global i.e., YungShin Global and Shiny Chemical go up and down completely randomly.
Pair Corralation between YungShin Global and Shiny Chemical
Assuming the 90 days trading horizon YungShin Global is expected to generate 1.25 times less return on investment than Shiny Chemical. But when comparing it to its historical volatility, YungShin Global Holding is 1.74 times less risky than Shiny Chemical. It trades about 0.05 of its potential returns per unit of risk. Shiny Chemical Industrial is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 12,550 in Shiny Chemical Industrial on November 27, 2024 and sell it today you would earn a total of 2,900 from holding Shiny Chemical Industrial or generate 23.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
YungShin Global Holding vs. Shiny Chemical Industrial
Performance |
| Timeline |
| YungShin Global Holding |
| Shiny Chemical Industrial |
YungShin Global and Shiny Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YungShin Global and Shiny Chemical
The main advantage of trading using opposite YungShin Global and Shiny Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YungShin Global position performs unexpectedly, Shiny Chemical 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 Shiny Chemical will offset losses from the drop in Shiny Chemical's long position.| YungShin Global vs. Sinphar Pharmaceutical Co | YungShin Global vs. Phytohealth Corp | YungShin Global vs. Excelsior Medical Co | YungShin Global vs. Abnova Taiwan Corp |
| Shiny Chemical vs. Chung Hwa Chemical | Shiny Chemical vs. China Man Made Fiber | Shiny Chemical vs. Sesoda Corp | Shiny Chemical vs. Everlight Chemical Industrial |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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