Correlation Between Capital Futures and Sinopac Financial
Can any of the company-specific risk be diversified away by investing in both Capital Futures and Sinopac Financial 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 Capital Futures and Sinopac Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital Futures Corp and Sinopac Financial Holdings, you can compare the effects of market volatilities on Capital Futures and Sinopac Financial 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 Capital Futures with a short position of Sinopac Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Futures and Sinopac Financial.
Diversification Opportunities for Capital Futures and Sinopac Financial
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Capital and Sinopac is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Capital Futures Corp and Sinopac Financial Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinopac Financial and Capital Futures 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 Capital Futures Corp are associated (or correlated) with Sinopac Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinopac Financial has no effect on the direction of Capital Futures i.e., Capital Futures and Sinopac Financial go up and down completely randomly.
Pair Corralation between Capital Futures and Sinopac Financial
Assuming the 90 days trading horizon Capital Futures is expected to generate 1.32 times less return on investment than Sinopac Financial. But when comparing it to its historical volatility, Capital Futures Corp is 1.02 times less risky than Sinopac Financial. It trades about 0.06 of its potential returns per unit of risk. Sinopac Financial Holdings is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,684 in Sinopac Financial Holdings on September 2, 2024 and sell it today you would earn a total of 641.00 from holding Sinopac Financial Holdings or generate 38.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Capital Futures Corp vs. Sinopac Financial Holdings
Performance |
| Timeline |
| Capital Futures Corp |
| Sinopac Financial |
Capital Futures and Sinopac Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Futures and Sinopac Financial
The main advantage of trading using opposite Capital Futures and Sinopac Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Futures position performs unexpectedly, Sinopac Financial 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 Sinopac Financial will offset losses from the drop in Sinopac Financial's long position.| Capital Futures vs. Hung Sheng Construction | Capital Futures vs. Mercuries Life Insurance | Capital Futures vs. Sinher Technology | Capital Futures vs. YungShin Global Holding |
| Sinopac Financial vs. Central Reinsurance Corp | Sinopac Financial vs. Huaku Development Co | Sinopac Financial vs. Fubon Financial Holding |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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