Correlation Between Sunfon Construction and HiTi Digital
Can any of the company-specific risk be diversified away by investing in both Sunfon Construction and HiTi Digital 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 Sunfon Construction and HiTi Digital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sunfon Construction Co and HiTi Digital, you can compare the effects of market volatilities on Sunfon Construction and HiTi Digital 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 Sunfon Construction with a short position of HiTi Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunfon Construction and HiTi Digital.
Diversification Opportunities for Sunfon Construction and HiTi Digital
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sunfon and HiTi is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Sunfon Construction Co and HiTi Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HiTi Digital and Sunfon 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 Sunfon Construction Co are associated (or correlated) with HiTi Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HiTi Digital has no effect on the direction of Sunfon Construction i.e., Sunfon Construction and HiTi Digital go up and down completely randomly.
Pair Corralation between Sunfon Construction and HiTi Digital
Assuming the 90 days trading horizon Sunfon Construction is expected to generate 18.22 times less return on investment than HiTi Digital. But when comparing it to its historical volatility, Sunfon Construction Co is 3.62 times less risky than HiTi Digital. It trades about 0.01 of its potential returns per unit of risk. HiTi Digital is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 697.00 in HiTi Digital on August 26, 2024 and sell it today you would earn a total of 1,054 from holding HiTi Digital or generate 151.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.18% |
| Values | Daily Returns |
Sunfon Construction Co vs. HiTi Digital
Performance |
| Timeline |
| Sunfon Construction |
| HiTi Digital |
Sunfon Construction and HiTi Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunfon Construction and HiTi Digital
The main advantage of trading using opposite Sunfon Construction and HiTi Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunfon Construction position performs unexpectedly, HiTi Digital 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 HiTi Digital will offset losses from the drop in HiTi Digital's long position.| Sunfon Construction vs. Run Long Construction | Sunfon Construction vs. Chong Hong Construction | Sunfon Construction vs. JSL Construction Development | Sunfon Construction vs. Delpha Construction Co |
| HiTi Digital vs. Novatek Microelectronics Corp | HiTi Digital vs. Quanta Computer | HiTi Digital vs. United Microelectronics |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |