Correlation Between Shin Ruenn and Infortrend Technology
Can any of the company-specific risk be diversified away by investing in both Shin Ruenn and Infortrend Technology 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 Shin Ruenn and Infortrend Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shin Ruenn Development and Infortrend Technology, you can compare the effects of market volatilities on Shin Ruenn and Infortrend Technology 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 Shin Ruenn with a short position of Infortrend Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shin Ruenn and Infortrend Technology.
Diversification Opportunities for Shin Ruenn and Infortrend Technology
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Shin and Infortrend is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Shin Ruenn Development and Infortrend Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infortrend Technology and Shin Ruenn 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 Shin Ruenn Development are associated (or correlated) with Infortrend Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infortrend Technology has no effect on the direction of Shin Ruenn i.e., Shin Ruenn and Infortrend Technology go up and down completely randomly.
Pair Corralation between Shin Ruenn and Infortrend Technology
Assuming the 90 days trading horizon Shin Ruenn is expected to generate 1.07 times less return on investment than Infortrend Technology. But when comparing it to its historical volatility, Shin Ruenn Development is 1.36 times less risky than Infortrend Technology. It trades about 0.07 of its potential returns per unit of risk. Infortrend Technology is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2,021 in Infortrend Technology on August 31, 2024 and sell it today you would earn a total of 1,629 from holding Infortrend Technology or generate 80.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shin Ruenn Development vs. Infortrend Technology
Performance |
| Timeline |
| Shin Ruenn Development |
| Infortrend Technology |
Shin Ruenn and Infortrend Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shin Ruenn and Infortrend Technology
The main advantage of trading using opposite Shin Ruenn and Infortrend Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shin Ruenn position performs unexpectedly, Infortrend Technology 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 Infortrend Technology will offset losses from the drop in Infortrend Technology's long position.| Shin Ruenn vs. Highwealth Construction Corp | Shin Ruenn vs. Sakura Development Co | Shin Ruenn vs. Kunyue Development Co |
| Infortrend Technology vs. Amtran Technology Co | Infortrend Technology vs. Ichia Technologies | Infortrend Technology vs. Zinwell | Infortrend Technology vs. K Laser 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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