Correlation Between SynCore Biotechnology and Wafer Works
Can any of the company-specific risk be diversified away by investing in both SynCore Biotechnology and Wafer Works 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 SynCore Biotechnology and Wafer Works into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SynCore Biotechnology Co and Wafer Works, you can compare the effects of market volatilities on SynCore Biotechnology and Wafer Works 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 SynCore Biotechnology with a short position of Wafer Works. Check out your portfolio center. Please also check ongoing floating volatility patterns of SynCore Biotechnology and Wafer Works.
Diversification Opportunities for SynCore Biotechnology and Wafer Works
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SynCore and Wafer is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding SynCore Biotechnology Co and Wafer Works in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wafer Works and SynCore Biotechnology 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 SynCore Biotechnology Co are associated (or correlated) with Wafer Works. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wafer Works has no effect on the direction of SynCore Biotechnology i.e., SynCore Biotechnology and Wafer Works go up and down completely randomly.
Pair Corralation between SynCore Biotechnology and Wafer Works
Assuming the 90 days trading horizon SynCore Biotechnology Co is expected to under-perform the Wafer Works. But the stock apears to be less risky and, when comparing its historical volatility, SynCore Biotechnology Co is 1.35 times less risky than Wafer Works. The stock trades about -0.05 of its potential returns per unit of risk. The Wafer Works is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 3,065 in Wafer Works on August 26, 2024 and sell it today you would lose (40.00) from holding Wafer Works or give up 1.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SynCore Biotechnology Co vs. Wafer Works
Performance |
| Timeline |
| SynCore Biotechnology |
| Wafer Works |
SynCore Biotechnology and Wafer Works Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SynCore Biotechnology and Wafer Works
The main advantage of trading using opposite SynCore Biotechnology and Wafer Works positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SynCore Biotechnology position performs unexpectedly, Wafer Works 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 Wafer Works will offset losses from the drop in Wafer Works' long position.| SynCore Biotechnology vs. Johnson Chemical Pharmaceutical | SynCore Biotechnology vs. Double Bond Chemical | SynCore Biotechnology vs. Yong Shun Chemical | SynCore Biotechnology vs. Asmedia Technology |
| Wafer Works vs. Sino American Silicon Products | Wafer Works vs. GlobalWafers Co | Wafer Works vs. Motech Industries Co | Wafer Works vs. Formosa Sumco 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 CEOs Directory module to screen CEOs from public companies around the world.
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