Correlation Between Chumpower Machinery and PChome Online
Can any of the company-specific risk be diversified away by investing in both Chumpower Machinery and PChome Online 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 Chumpower Machinery and PChome Online into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chumpower Machinery Corp and PChome Online, you can compare the effects of market volatilities on Chumpower Machinery and PChome Online 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 Chumpower Machinery with a short position of PChome Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chumpower Machinery and PChome Online.
Diversification Opportunities for Chumpower Machinery and PChome Online
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Chumpower and PChome is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Chumpower Machinery Corp and PChome Online in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PChome Online and Chumpower Machinery 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 Chumpower Machinery Corp are associated (or correlated) with PChome Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PChome Online has no effect on the direction of Chumpower Machinery i.e., Chumpower Machinery and PChome Online go up and down completely randomly.
Pair Corralation between Chumpower Machinery and PChome Online
Assuming the 90 days trading horizon Chumpower Machinery Corp is expected to generate 0.83 times more return on investment than PChome Online. However, Chumpower Machinery Corp is 1.2 times less risky than PChome Online. It trades about 0.02 of its potential returns per unit of risk. PChome Online is currently generating about -0.02 per unit of risk. If you would invest 2,026 in Chumpower Machinery Corp on October 25, 2024 and sell it today you would earn a total of 289.00 from holding Chumpower Machinery Corp or generate 14.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chumpower Machinery Corp vs. PChome Online
Performance |
| Timeline |
| Chumpower Machinery Corp |
| PChome Online |
Chumpower Machinery and PChome Online Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chumpower Machinery and PChome Online
The main advantage of trading using opposite Chumpower Machinery and PChome Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chumpower Machinery position performs unexpectedly, PChome Online 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 PChome Online will offset losses from the drop in PChome Online's long position.| Chumpower Machinery vs. Oceanic Beverages Co | Chumpower Machinery vs. Union Bank of | Chumpower Machinery vs. Yuanta Financial Holdings | Chumpower Machinery vs. Hunya Foods Co |
| PChome Online vs. momo Inc | PChome Online vs. President Chain Store | PChome Online vs. Uni President Enterprises Corp | PChome Online vs. Taiwan FamilyMart 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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