Correlation Between Shin Ruenn and Taiwan FamilyMart
Can any of the company-specific risk be diversified away by investing in both Shin Ruenn and Taiwan FamilyMart 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 Taiwan FamilyMart 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 Taiwan FamilyMart Co, you can compare the effects of market volatilities on Shin Ruenn and Taiwan FamilyMart 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 Taiwan FamilyMart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shin Ruenn and Taiwan FamilyMart.
Diversification Opportunities for Shin Ruenn and Taiwan FamilyMart
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Shin and Taiwan is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Shin Ruenn Development and Taiwan FamilyMart Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taiwan FamilyMart 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 Taiwan FamilyMart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taiwan FamilyMart has no effect on the direction of Shin Ruenn i.e., Shin Ruenn and Taiwan FamilyMart go up and down completely randomly.
Pair Corralation between Shin Ruenn and Taiwan FamilyMart
Assuming the 90 days trading horizon Shin Ruenn Development is expected to generate 4.04 times more return on investment than Taiwan FamilyMart. However, Shin Ruenn is 4.04 times more volatile than Taiwan FamilyMart Co. It trades about 0.13 of its potential returns per unit of risk. Taiwan FamilyMart Co is currently generating about 0.04 per unit of risk. If you would invest 6,010 in Shin Ruenn Development on August 31, 2024 and sell it today you would earn a total of 430.00 from holding Shin Ruenn Development or generate 7.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shin Ruenn Development vs. Taiwan FamilyMart Co
Performance |
| Timeline |
| Shin Ruenn Development |
| Taiwan FamilyMart |
Shin Ruenn and Taiwan FamilyMart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shin Ruenn and Taiwan FamilyMart
The main advantage of trading using opposite Shin Ruenn and Taiwan FamilyMart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shin Ruenn position performs unexpectedly, Taiwan FamilyMart 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 Taiwan FamilyMart will offset losses from the drop in Taiwan FamilyMart's long position.| Shin Ruenn vs. Everlight Chemical Industrial | Shin Ruenn vs. Formosa Chemicals Fibre | Shin Ruenn vs. Amtran Technology Co | Shin Ruenn vs. Sunnic Technology Merchandise |
| Taiwan FamilyMart vs. President Chain Store | Taiwan FamilyMart vs. Uni President Enterprises Corp | Taiwan FamilyMart vs. Poya International Co | Taiwan FamilyMart vs. Hotai Motor Co |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |