Correlation Between Highlight Tech and Senao International
Can any of the company-specific risk be diversified away by investing in both Highlight Tech and Senao International 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 Highlight Tech and Senao International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Highlight Tech and Senao International Co, you can compare the effects of market volatilities on Highlight Tech and Senao International 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 Highlight Tech with a short position of Senao International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highlight Tech and Senao International.
Diversification Opportunities for Highlight Tech and Senao International
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Highlight and Senao is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Highlight Tech and Senao International Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Senao International and Highlight Tech 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 Highlight Tech are associated (or correlated) with Senao International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Senao International has no effect on the direction of Highlight Tech i.e., Highlight Tech and Senao International go up and down completely randomly.
Pair Corralation between Highlight Tech and Senao International
Assuming the 90 days trading horizon Highlight Tech is expected to generate 2.51 times more return on investment than Senao International. However, Highlight Tech is 2.51 times more volatile than Senao International Co. It trades about 0.02 of its potential returns per unit of risk. Senao International Co is currently generating about 0.03 per unit of risk. If you would invest 4,718 in Highlight Tech on September 3, 2024 and sell it today you would earn a total of 642.00 from holding Highlight Tech or generate 13.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Highlight Tech vs. Senao International Co
Performance |
| Timeline |
| Highlight Tech |
| Senao International |
Highlight Tech and Senao International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Highlight Tech and Senao International
The main advantage of trading using opposite Highlight Tech and Senao International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highlight Tech position performs unexpectedly, Senao International 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 Senao International will offset losses from the drop in Senao International's long position.| Highlight Tech vs. WiseChip Semiconductor | Highlight Tech vs. Novatek Microelectronics Corp | Highlight Tech vs. Leader Electronics | Highlight Tech vs. Information Technology Total |
| Senao International vs. Elite Material Co | Senao International vs. Highlight Tech | Senao International vs. Victory New Materials | Senao International vs. Grand Plastic 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |