Correlation Between Grand Fortune and Transcend Information
Can any of the company-specific risk be diversified away by investing in both Grand Fortune and Transcend Information 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 Fortune and Transcend Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grand Fortune Securities and Transcend Information, you can compare the effects of market volatilities on Grand Fortune and Transcend Information 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 Fortune with a short position of Transcend Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grand Fortune and Transcend Information.
Diversification Opportunities for Grand Fortune and Transcend Information
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Grand and Transcend is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Grand Fortune Securities and Transcend Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transcend Information and Grand Fortune 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 Fortune Securities are associated (or correlated) with Transcend Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transcend Information has no effect on the direction of Grand Fortune i.e., Grand Fortune and Transcend Information go up and down completely randomly.
Pair Corralation between Grand Fortune and Transcend Information
Assuming the 90 days trading horizon Grand Fortune Securities is expected to generate 1.08 times more return on investment than Transcend Information. However, Grand Fortune is 1.08 times more volatile than Transcend Information. It trades about 0.05 of its potential returns per unit of risk. Transcend Information is currently generating about 0.04 per unit of risk. If you would invest 920.00 in Grand Fortune Securities on October 9, 2024 and sell it today you would earn a total of 330.00 from holding Grand Fortune Securities or generate 35.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grand Fortune Securities vs. Transcend Information
Performance |
| Timeline |
| Grand Fortune Securities |
| Transcend Information |
Grand Fortune and Transcend Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grand Fortune and Transcend Information
The main advantage of trading using opposite Grand Fortune and Transcend Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grand Fortune position performs unexpectedly, Transcend Information 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 Transcend Information will offset losses from the drop in Transcend Information's long position.| Grand Fortune vs. Amulaire Thermal Technology | Grand Fortune vs. U Ming Marine Transport | Grand Fortune vs. Golden Biotechnology | Grand Fortune vs. Chung Lien Transportation |
| Transcend Information vs. Holy Stone Enterprise | Transcend Information vs. Walsin Technology Corp | Transcend Information vs. Yageo Corp | Transcend Information vs. HannStar Board 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 CEOs Directory module to screen CEOs from public companies around the world.
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