Correlation Between Simplo Technology and Yummy Town
Can any of the company-specific risk be diversified away by investing in both Simplo Technology and Yummy Town 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 Simplo Technology and Yummy Town into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Simplo Technology Co and Yummy Town Cayman, you can compare the effects of market volatilities on Simplo Technology and Yummy Town 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 Simplo Technology with a short position of Yummy Town. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simplo Technology and Yummy Town.
Diversification Opportunities for Simplo Technology and Yummy Town
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Simplo and Yummy is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Simplo Technology Co and Yummy Town Cayman in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yummy Town Cayman and Simplo Technology 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 Simplo Technology Co are associated (or correlated) with Yummy Town. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yummy Town Cayman has no effect on the direction of Simplo Technology i.e., Simplo Technology and Yummy Town go up and down completely randomly.
Pair Corralation between Simplo Technology and Yummy Town
Assuming the 90 days trading horizon Simplo Technology Co is expected to generate 2.06 times more return on investment than Yummy Town. However, Simplo Technology is 2.06 times more volatile than Yummy Town Cayman. It trades about 0.17 of its potential returns per unit of risk. Yummy Town Cayman is currently generating about -0.24 per unit of risk. If you would invest 34,250 in Simplo Technology Co on September 2, 2024 and sell it today you would earn a total of 3,450 from holding Simplo Technology Co or generate 10.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Simplo Technology Co vs. Yummy Town Cayman
Performance |
| Timeline |
| Simplo Technology |
| Yummy Town Cayman |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Simplo Technology and Yummy Town Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simplo Technology and Yummy Town
The main advantage of trading using opposite Simplo Technology and Yummy Town positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simplo Technology position performs unexpectedly, Yummy Town 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 Yummy Town will offset losses from the drop in Yummy Town's long position.| Simplo Technology vs. Walsin Lihwa Corp | Simplo Technology vs. Advanced Energy Solution | Simplo Technology vs. Ta Ya Electric | Simplo Technology vs. Amtran Technology Co |
| Yummy Town vs. Eastern Media International | Yummy Town vs. Asia Metal Industries | Yummy Town vs. Asmedia Technology | Yummy Town vs. Cayenne Entertainment Technology |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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