Correlation Between Shih Wei and Lion Travel
Can any of the company-specific risk be diversified away by investing in both Shih Wei and Lion Travel 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 Shih Wei and Lion Travel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shih Wei Navigation and Lion Travel Service, you can compare the effects of market volatilities on Shih Wei and Lion Travel 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 Shih Wei with a short position of Lion Travel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shih Wei and Lion Travel.
Diversification Opportunities for Shih Wei and Lion Travel
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shih and Lion is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Shih Wei Navigation and Lion Travel Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion Travel Service and Shih Wei 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 Shih Wei Navigation are associated (or correlated) with Lion Travel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion Travel Service has no effect on the direction of Shih Wei i.e., Shih Wei and Lion Travel go up and down completely randomly.
Pair Corralation between Shih Wei and Lion Travel
Assuming the 90 days trading horizon Shih Wei Navigation is expected to under-perform the Lion Travel. In addition to that, Shih Wei is 1.05 times more volatile than Lion Travel Service. It trades about -0.08 of its total potential returns per unit of risk. Lion Travel Service is currently generating about -0.07 per unit of volatility. If you would invest 15,450 in Lion Travel Service on August 31, 2024 and sell it today you would lose (3,300) from holding Lion Travel Service or give up 21.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shih Wei Navigation vs. Lion Travel Service
Performance |
| Timeline |
| Shih Wei Navigation |
| Lion Travel Service |
Shih Wei and Lion Travel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shih Wei and Lion Travel
The main advantage of trading using opposite Shih Wei and Lion Travel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shih Wei position performs unexpectedly, Lion Travel 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 Lion Travel will offset losses from the drop in Lion Travel's long position.| Shih Wei vs. BES Engineering Co | Shih Wei vs. Continental Holdings Corp | Shih Wei vs. Kee Tai Properties | Shih Wei vs. Hung Sheng Construction |
| Lion Travel vs. Eva Airways Corp | Lion Travel vs. Formosa International Hotels | Lion Travel vs. China Airlines | Lion Travel vs. Uni President Enterprises Corp |
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
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |