Correlation Between Roo Hsing and Chaintech Technology
Can any of the company-specific risk be diversified away by investing in both Roo Hsing and Chaintech Technology 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 Roo Hsing and Chaintech Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Roo Hsing Co and Chaintech Technology Corp, you can compare the effects of market volatilities on Roo Hsing and Chaintech Technology 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 Roo Hsing with a short position of Chaintech Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Roo Hsing and Chaintech Technology.
Diversification Opportunities for Roo Hsing and Chaintech Technology
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Roo and Chaintech is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Roo Hsing Co and Chaintech Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chaintech Technology Corp and Roo Hsing 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 Roo Hsing Co are associated (or correlated) with Chaintech Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chaintech Technology Corp has no effect on the direction of Roo Hsing i.e., Roo Hsing and Chaintech Technology go up and down completely randomly.
Pair Corralation between Roo Hsing and Chaintech Technology
Assuming the 90 days trading horizon Roo Hsing Co is expected to generate 0.49 times more return on investment than Chaintech Technology. However, Roo Hsing Co is 2.06 times less risky than Chaintech Technology. It trades about 0.02 of its potential returns per unit of risk. Chaintech Technology Corp is currently generating about -0.08 per unit of risk. If you would invest 312.00 in Roo Hsing Co on August 31, 2024 and sell it today you would earn a total of 2.00 from holding Roo Hsing Co or generate 0.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Roo Hsing Co vs. Chaintech Technology Corp
Performance |
| Timeline |
| Roo Hsing |
| Chaintech Technology Corp |
Roo Hsing and Chaintech Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Roo Hsing and Chaintech Technology
The main advantage of trading using opposite Roo Hsing and Chaintech Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Roo Hsing position performs unexpectedly, Chaintech Technology 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 Chaintech Technology will offset losses from the drop in Chaintech Technology's long position.| Roo Hsing vs. Chaintech Technology Corp | Roo Hsing vs. AVerMedia Technologies | Roo Hsing vs. Avision | Roo Hsing vs. Clevo Co |
| Chaintech Technology vs. Biostar Microtech International | Chaintech Technology vs. Elitegroup Computer Systems | Chaintech Technology vs. Shuttle | Chaintech Technology vs. Gigabyte Technology Co |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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