Correlation Between Chien Kuo and Dawushan Farm
Can any of the company-specific risk be diversified away by investing in both Chien Kuo and Dawushan Farm 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 Chien Kuo and Dawushan Farm into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chien Kuo Construction and Dawushan Farm Tech, you can compare the effects of market volatilities on Chien Kuo and Dawushan Farm 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 Chien Kuo with a short position of Dawushan Farm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chien Kuo and Dawushan Farm.
Diversification Opportunities for Chien Kuo and Dawushan Farm
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Chien and Dawushan is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Chien Kuo Construction and Dawushan Farm Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dawushan Farm Tech and Chien Kuo 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 Chien Kuo Construction are associated (or correlated) with Dawushan Farm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dawushan Farm Tech has no effect on the direction of Chien Kuo i.e., Chien Kuo and Dawushan Farm go up and down completely randomly.
Pair Corralation between Chien Kuo and Dawushan Farm
Assuming the 90 days trading horizon Chien Kuo is expected to generate 34.51 times less return on investment than Dawushan Farm. In addition to that, Chien Kuo is 1.08 times more volatile than Dawushan Farm Tech. It trades about 0.0 of its total potential returns per unit of risk. Dawushan Farm Tech is currently generating about 0.15 per unit of volatility. If you would invest 4,650 in Dawushan Farm Tech on September 2, 2024 and sell it today you would earn a total of 345.00 from holding Dawushan Farm Tech or generate 7.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chien Kuo Construction vs. Dawushan Farm Tech
Performance |
| Timeline |
| Chien Kuo Construction |
| Dawushan Farm Tech |
Chien Kuo and Dawushan Farm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chien Kuo and Dawushan Farm
The main advantage of trading using opposite Chien Kuo and Dawushan Farm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chien Kuo position performs unexpectedly, Dawushan Farm 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 Dawushan Farm will offset losses from the drop in Dawushan Farm's long position.| Chien Kuo vs. BES Engineering Co | Chien Kuo vs. Continental Holdings Corp | Chien Kuo vs. Kee Tai Properties | Chien Kuo vs. Hung Sheng Construction |
| Dawushan Farm vs. Taiwan Semiconductor Manufacturing | Dawushan Farm vs. Hon Hai Precision | Dawushan Farm vs. MediaTek | Dawushan Farm vs. Chunghwa Telecom 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |