Correlation Between Yungshin Construction and Cameo Communications
Can any of the company-specific risk be diversified away by investing in both Yungshin Construction and Cameo Communications 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 Yungshin Construction and Cameo Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yungshin Construction Development and Cameo Communications, you can compare the effects of market volatilities on Yungshin Construction and Cameo Communications 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 Yungshin Construction with a short position of Cameo Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yungshin Construction and Cameo Communications.
Diversification Opportunities for Yungshin Construction and Cameo Communications
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Yungshin and Cameo is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Yungshin Construction Developm and Cameo Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cameo Communications and Yungshin Construction 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 Yungshin Construction Development are associated (or correlated) with Cameo Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cameo Communications has no effect on the direction of Yungshin Construction i.e., Yungshin Construction and Cameo Communications go up and down completely randomly.
Pair Corralation between Yungshin Construction and Cameo Communications
Assuming the 90 days trading horizon Yungshin Construction Development is expected to generate 1.41 times more return on investment than Cameo Communications. However, Yungshin Construction is 1.41 times more volatile than Cameo Communications. It trades about 0.08 of its potential returns per unit of risk. Cameo Communications is currently generating about 0.04 per unit of risk. If you would invest 8,717 in Yungshin Construction Development on September 12, 2024 and sell it today you would earn a total of 5,983 from holding Yungshin Construction Development or generate 68.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yungshin Construction Developm vs. Cameo Communications
Performance |
| Timeline |
| Yungshin Construction |
| Cameo Communications |
Yungshin Construction and Cameo Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yungshin Construction and Cameo Communications
The main advantage of trading using opposite Yungshin Construction and Cameo Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yungshin Construction position performs unexpectedly, Cameo Communications 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 Cameo Communications will offset losses from the drop in Cameo Communications' long position.| Yungshin Construction vs. Chong Hong Construction | Yungshin Construction vs. Ruentex Development Co | Yungshin Construction vs. Symtek Automation Asia | Yungshin Construction vs. WiseChip Semiconductor |
| Cameo Communications vs. AU Optronics | Cameo Communications vs. Innolux Corp | Cameo Communications vs. Ruentex Development Co | Cameo Communications vs. WiseChip Semiconductor |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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