Correlation Between Sunfon Construction and Taiwan FamilyMart
Can any of the company-specific risk be diversified away by investing in both Sunfon Construction and Taiwan FamilyMart 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 Taiwan FamilyMart 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 Taiwan FamilyMart Co, you can compare the effects of market volatilities on Sunfon Construction and Taiwan FamilyMart 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 Taiwan FamilyMart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunfon Construction and Taiwan FamilyMart.
Diversification Opportunities for Sunfon Construction and Taiwan FamilyMart
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sunfon and Taiwan is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Sunfon Construction Co and Taiwan FamilyMart Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taiwan FamilyMart 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 Taiwan FamilyMart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taiwan FamilyMart has no effect on the direction of Sunfon Construction i.e., Sunfon Construction and Taiwan FamilyMart go up and down completely randomly.
Pair Corralation between Sunfon Construction and Taiwan FamilyMart
Assuming the 90 days trading horizon Sunfon Construction Co is expected to under-perform the Taiwan FamilyMart. In addition to that, Sunfon Construction is 1.77 times more volatile than Taiwan FamilyMart Co. It trades about -0.09 of its total potential returns per unit of risk. Taiwan FamilyMart Co is currently generating about 0.04 per unit of volatility. If you would invest 18,900 in Taiwan FamilyMart Co on August 31, 2024 and sell it today you would earn a total of 100.00 from holding Taiwan FamilyMart Co or generate 0.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunfon Construction Co vs. Taiwan FamilyMart Co
Performance |
| Timeline |
| Sunfon Construction |
| Taiwan FamilyMart |
Sunfon Construction and Taiwan FamilyMart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunfon Construction and Taiwan FamilyMart
The main advantage of trading using opposite Sunfon Construction and Taiwan FamilyMart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunfon Construction position performs unexpectedly, Taiwan FamilyMart 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 Taiwan FamilyMart will offset losses from the drop in Taiwan FamilyMart's long position.| Sunfon Construction vs. United Radiant Technology | Sunfon Construction vs. Microtips Technology | Sunfon Construction vs. Dadi Early Childhood Education | Sunfon Construction vs. China Times Publishing |
| Taiwan FamilyMart vs. President Chain Store | Taiwan FamilyMart vs. Uni President Enterprises Corp | Taiwan FamilyMart vs. Poya International Co | Taiwan FamilyMart vs. Hotai Motor Co |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |