Correlation Between San Fu and Eternal Materials
Can any of the company-specific risk be diversified away by investing in both San Fu and Eternal Materials 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 San Fu and Eternal Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between San Fu Chemical and Eternal Materials Co, you can compare the effects of market volatilities on San Fu and Eternal Materials 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 San Fu with a short position of Eternal Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of San Fu and Eternal Materials.
Diversification Opportunities for San Fu and Eternal Materials
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between San and Eternal is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding San Fu Chemical and Eternal Materials Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eternal Materials and San Fu 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 San Fu Chemical are associated (or correlated) with Eternal Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eternal Materials has no effect on the direction of San Fu i.e., San Fu and Eternal Materials go up and down completely randomly.
Pair Corralation between San Fu and Eternal Materials
Assuming the 90 days trading horizon San Fu Chemical is expected to under-perform the Eternal Materials. In addition to that, San Fu is 1.55 times more volatile than Eternal Materials Co. It trades about -0.15 of its total potential returns per unit of risk. Eternal Materials Co is currently generating about 0.01 per unit of volatility. If you would invest 2,830 in Eternal Materials Co on October 28, 2024 and sell it today you would earn a total of 5.00 from holding Eternal Materials Co or generate 0.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
San Fu Chemical vs. Eternal Materials Co
Performance |
| Timeline |
| San Fu Chemical |
| Eternal Materials |
San Fu and Eternal Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with San Fu and Eternal Materials
The main advantage of trading using opposite San Fu and Eternal Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if San Fu position performs unexpectedly, Eternal Materials 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 Eternal Materials will offset losses from the drop in Eternal Materials' long position.| San Fu vs. Nan Ya Plastics | San Fu vs. China Petrochemical Development | San Fu vs. Eternal Materials Co | San Fu vs. TSRC Corp |
| Eternal Materials vs. Taiwan Fertilizer Co | Eternal Materials vs. Nan Ya Plastics | Eternal Materials vs. Formosa Chemicals Fibre | Eternal Materials vs. Far Eastern New |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |