Correlation Between Grand Ocean and Amazing Microelectronic
Can any of the company-specific risk be diversified away by investing in both Grand Ocean and Amazing Microelectronic 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 Grand Ocean and Amazing Microelectronic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grand Ocean Retail and Amazing Microelectronic, you can compare the effects of market volatilities on Grand Ocean and Amazing Microelectronic 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 Grand Ocean with a short position of Amazing Microelectronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grand Ocean and Amazing Microelectronic.
Diversification Opportunities for Grand Ocean and Amazing Microelectronic
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Grand and Amazing is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Grand Ocean Retail and Amazing Microelectronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amazing Microelectronic and Grand Ocean 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 Grand Ocean Retail are associated (or correlated) with Amazing Microelectronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amazing Microelectronic has no effect on the direction of Grand Ocean i.e., Grand Ocean and Amazing Microelectronic go up and down completely randomly.
Pair Corralation between Grand Ocean and Amazing Microelectronic
Assuming the 90 days trading horizon Grand Ocean Retail is expected to under-perform the Amazing Microelectronic. In addition to that, Grand Ocean is 2.43 times more volatile than Amazing Microelectronic. It trades about -0.13 of its total potential returns per unit of risk. Amazing Microelectronic is currently generating about -0.1 per unit of volatility. If you would invest 9,800 in Amazing Microelectronic on August 30, 2024 and sell it today you would lose (350.00) from holding Amazing Microelectronic or give up 3.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grand Ocean Retail vs. Amazing Microelectronic
Performance |
| Timeline |
| Grand Ocean Retail |
| Amazing Microelectronic |
Grand Ocean and Amazing Microelectronic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grand Ocean and Amazing Microelectronic
The main advantage of trading using opposite Grand Ocean and Amazing Microelectronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grand Ocean position performs unexpectedly, Amazing Microelectronic 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 Amazing Microelectronic will offset losses from the drop in Amazing Microelectronic's long position.| Grand Ocean vs. First Steamship Co | Grand Ocean vs. Far Eastern Department | Grand Ocean vs. LongDa Construction Development | Grand Ocean vs. Collins Co |
| Amazing Microelectronic vs. Univacco Technology | Amazing Microelectronic vs. Yeou Yih Steel | Amazing Microelectronic vs. Chicony Power Technology | Amazing Microelectronic vs. Quintain Steel 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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