Correlation Between Chong Hong and Sunfon Construction
Can any of the company-specific risk be diversified away by investing in both Chong Hong and Sunfon Construction 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 Chong Hong and Sunfon Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chong Hong Construction and Sunfon Construction Co, you can compare the effects of market volatilities on Chong Hong and Sunfon Construction 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 Chong Hong with a short position of Sunfon Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chong Hong and Sunfon Construction.
Diversification Opportunities for Chong Hong and Sunfon Construction
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Chong and Sunfon is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Chong Hong Construction and Sunfon Construction Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunfon Construction and Chong Hong 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 Chong Hong Construction are associated (or correlated) with Sunfon Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunfon Construction has no effect on the direction of Chong Hong i.e., Chong Hong and Sunfon Construction go up and down completely randomly.
Pair Corralation between Chong Hong and Sunfon Construction
Assuming the 90 days trading horizon Chong Hong is expected to generate 1.27 times less return on investment than Sunfon Construction. In addition to that, Chong Hong is 1.09 times more volatile than Sunfon Construction Co. It trades about 0.02 of its total potential returns per unit of risk. Sunfon Construction Co is currently generating about 0.03 per unit of volatility. If you would invest 1,795 in Sunfon Construction Co on August 30, 2024 and sell it today you would earn a total of 235.00 from holding Sunfon Construction Co or generate 13.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chong Hong Construction vs. Sunfon Construction Co
Performance |
| Timeline |
| Chong Hong Construction |
| Sunfon Construction |
Chong Hong and Sunfon Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chong Hong and Sunfon Construction
The main advantage of trading using opposite Chong Hong and Sunfon Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chong Hong position performs unexpectedly, Sunfon Construction 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 Sunfon Construction will offset losses from the drop in Sunfon Construction's long position.| Chong Hong vs. Tainan Spinning Co | Chong Hong vs. Carnival Industrial Corp | Chong Hong vs. Symtek Automation Asia | Chong Hong vs. CTCI Corp |
| Sunfon Construction vs. Sino Horizon Holdings | Sunfon Construction vs. Run Long Construction | Sunfon Construction vs. Chong Hong Construction | Sunfon Construction vs. Sinyi Realty |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| 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 | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |