Correlation Between YungShin Global and Chien Kuo
Can any of the company-specific risk be diversified away by investing in both YungShin Global and Chien Kuo 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 Chien Kuo 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 Chien Kuo Construction, you can compare the effects of market volatilities on YungShin Global and Chien Kuo 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 Chien Kuo. Check out your portfolio center. Please also check ongoing floating volatility patterns of YungShin Global and Chien Kuo.
Diversification Opportunities for YungShin Global and Chien Kuo
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between YungShin and Chien is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding YungShin Global Holding and Chien Kuo Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chien Kuo Construction 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 Chien Kuo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chien Kuo Construction has no effect on the direction of YungShin Global i.e., YungShin Global and Chien Kuo go up and down completely randomly.
Pair Corralation between YungShin Global and Chien Kuo
Assuming the 90 days trading horizon YungShin Global is expected to generate 3.42 times less return on investment than Chien Kuo. But when comparing it to its historical volatility, YungShin Global Holding is 2.29 times less risky than Chien Kuo. It trades about 0.07 of its potential returns per unit of risk. Chien Kuo Construction is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,530 in Chien Kuo Construction on September 3, 2024 and sell it today you would earn a total of 1,320 from holding Chien Kuo Construction or generate 86.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
YungShin Global Holding vs. Chien Kuo Construction
Performance |
| Timeline |
| YungShin Global Holding |
| Chien Kuo Construction |
YungShin Global and Chien Kuo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YungShin Global and Chien Kuo
The main advantage of trading using opposite YungShin Global and Chien Kuo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YungShin Global position performs unexpectedly, Chien Kuo 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 Chien Kuo will offset losses from the drop in Chien Kuo's long position.| YungShin Global vs. Sinphar Pharmaceutical Co | YungShin Global vs. WiseChip Semiconductor | YungShin Global vs. Novatek Microelectronics Corp | YungShin Global vs. Leader Electronics |
| Chien Kuo vs. Universal Microelectronics Co | Chien Kuo vs. AVerMedia Technologies | Chien Kuo vs. Symtek Automation Asia | Chien Kuo vs. WiseChip Semiconductor |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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