Correlation Between Coremax Corp and San Fu
Can any of the company-specific risk be diversified away by investing in both Coremax Corp and San Fu 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 Coremax Corp and San Fu into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coremax Corp and San Fu Chemical, you can compare the effects of market volatilities on Coremax Corp and San Fu 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 Coremax Corp with a short position of San Fu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coremax Corp and San Fu.
Diversification Opportunities for Coremax Corp and San Fu
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Coremax and San is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Coremax Corp and San Fu Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on San Fu Chemical and Coremax Corp 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 Coremax Corp are associated (or correlated) with San Fu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of San Fu Chemical has no effect on the direction of Coremax Corp i.e., Coremax Corp and San Fu go up and down completely randomly.
Pair Corralation between Coremax Corp and San Fu
Assuming the 90 days trading horizon Coremax Corp is expected to under-perform the San Fu. But the stock apears to be less risky and, when comparing its historical volatility, Coremax Corp is 1.17 times less risky than San Fu. The stock trades about 0.0 of its potential returns per unit of risk. The San Fu Chemical is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 12,700 in San Fu Chemical on August 30, 2024 and sell it today you would earn a total of 500.00 from holding San Fu Chemical or generate 3.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Coremax Corp vs. San Fu Chemical
Performance |
| Timeline |
| Coremax Corp |
| San Fu Chemical |
Coremax Corp and San Fu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coremax Corp and San Fu
The main advantage of trading using opposite Coremax Corp and San Fu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coremax Corp position performs unexpectedly, San Fu 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 San Fu will offset losses from the drop in San Fu's long position.| Coremax Corp vs. Mechema Chemicals Int | Coremax Corp vs. China Steel Chemical | Coremax Corp vs. Delta Electronics | Coremax Corp vs. Hota Industrial Mfg |
| San Fu vs. Nuvoton Technology Corp | San Fu vs. Shiny Chemical Industrial | San Fu vs. Jinan Acetate Chemical | San Fu vs. Coremax Corp |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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