Correlation Between SS Healthcare and Chia Yi
Can any of the company-specific risk be diversified away by investing in both SS Healthcare and Chia Yi 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 SS Healthcare and Chia Yi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SS Healthcare Holding and Chia Yi Steel, you can compare the effects of market volatilities on SS Healthcare and Chia Yi 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 SS Healthcare with a short position of Chia Yi. Check out your portfolio center. Please also check ongoing floating volatility patterns of SS Healthcare and Chia Yi.
Diversification Opportunities for SS Healthcare and Chia Yi
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between 4198 and Chia is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding SS Healthcare Holding and Chia Yi Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chia Yi Steel and SS Healthcare 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 SS Healthcare Holding are associated (or correlated) with Chia Yi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chia Yi Steel has no effect on the direction of SS Healthcare i.e., SS Healthcare and Chia Yi go up and down completely randomly.
Pair Corralation between SS Healthcare and Chia Yi
Assuming the 90 days trading horizon SS Healthcare Holding is expected to under-perform the Chia Yi. But the stock apears to be less risky and, when comparing its historical volatility, SS Healthcare Holding is 1.52 times less risky than Chia Yi. The stock trades about 0.0 of its potential returns per unit of risk. The Chia Yi Steel is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,035 in Chia Yi Steel on September 3, 2024 and sell it today you would earn a total of 85.00 from holding Chia Yi Steel or generate 8.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SS Healthcare Holding vs. Chia Yi Steel
Performance |
| Timeline |
| SS Healthcare Holding |
| Chia Yi Steel |
SS Healthcare and Chia Yi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SS Healthcare and Chia Yi
The main advantage of trading using opposite SS Healthcare and Chia Yi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SS Healthcare position performs unexpectedly, Chia Yi 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 Chia Yi will offset losses from the drop in Chia Yi's long position.| SS Healthcare vs. Sunspring Metal Corp | SS Healthcare vs. WinMate Communication INC | SS Healthcare vs. Asia Metal Industries | SS Healthcare vs. RiTdisplay Corp |
| Chia Yi vs. Catcher Technology Co | Chia Yi vs. Evergreen Steel Corp | Chia Yi vs. China Metal Products | Chia Yi vs. Chernan Metal 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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