Correlation Between I Sheng and In Win
Can any of the company-specific risk be diversified away by investing in both I Sheng and In Win 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 I Sheng and In Win into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between I Sheng Electric Wire and In Win Development, you can compare the effects of market volatilities on I Sheng and In Win 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 I Sheng with a short position of In Win. Check out your portfolio center. Please also check ongoing floating volatility patterns of I Sheng and In Win.
Diversification Opportunities for I Sheng and In Win
Modest diversification
The 3 months correlation between 6115 and 6117 is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding I Sheng Electric Wire and In Win Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on In Win Development and I Sheng 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 I Sheng Electric Wire are associated (or correlated) with In Win. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of In Win Development has no effect on the direction of I Sheng i.e., I Sheng and In Win go up and down completely randomly.
Pair Corralation between I Sheng and In Win
Assuming the 90 days trading horizon I Sheng is expected to generate 16.18 times less return on investment than In Win. But when comparing it to its historical volatility, I Sheng Electric Wire is 4.93 times less risky than In Win. It trades about 0.04 of its potential returns per unit of risk. In Win Development is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,725 in In Win Development on September 2, 2024 and sell it today you would earn a total of 8,725 from holding In Win Development or generate 505.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
I Sheng Electric Wire vs. In Win Development
Performance |
| Timeline |
| I Sheng Electric |
| In Win Development |
I Sheng and In Win Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with I Sheng and In Win
The main advantage of trading using opposite I Sheng and In Win positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if I Sheng position performs unexpectedly, In Win 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 In Win will offset losses from the drop in In Win's long position.| I Sheng vs. Unitech Computer Co | I Sheng vs. Far EasTone Telecommunications | I Sheng vs. Tai Tung Communication | I Sheng vs. Arima Communications 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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