Correlation Between Sunfon Construction and ASRock
Can any of the company-specific risk be diversified away by investing in both Sunfon Construction and ASRock 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 ASRock 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 ASRock Inc, you can compare the effects of market volatilities on Sunfon Construction and ASRock 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 ASRock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunfon Construction and ASRock.
Diversification Opportunities for Sunfon Construction and ASRock
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sunfon and ASRock is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Sunfon Construction Co and ASRock Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASRock Inc 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 ASRock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASRock Inc has no effect on the direction of Sunfon Construction i.e., Sunfon Construction and ASRock go up and down completely randomly.
Pair Corralation between Sunfon Construction and ASRock
Assuming the 90 days trading horizon Sunfon Construction Co is expected to under-perform the ASRock. But the stock apears to be less risky and, when comparing its historical volatility, Sunfon Construction Co is 3.97 times less risky than ASRock. The stock trades about -0.15 of its potential returns per unit of risk. The ASRock Inc is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 21,350 in ASRock Inc on August 26, 2024 and sell it today you would earn a total of 1,450 from holding ASRock Inc or generate 6.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunfon Construction Co vs. ASRock Inc
Performance |
| Timeline |
| Sunfon Construction |
| ASRock Inc |
Sunfon Construction and ASRock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunfon Construction and ASRock
The main advantage of trading using opposite Sunfon Construction and ASRock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunfon Construction position performs unexpectedly, ASRock 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 ASRock will offset losses from the drop in ASRock'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 |
| ASRock vs. Novatek Microelectronics Corp | ASRock vs. Quanta Computer | ASRock 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 CEOs Directory module to screen CEOs from public companies around the world.
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