Correlation Between C Media and Huang Hsiang
Can any of the company-specific risk be diversified away by investing in both C Media and Huang Hsiang 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 C Media and Huang Hsiang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between C Media Electronics and Huang Hsiang Construction, you can compare the effects of market volatilities on C Media and Huang Hsiang 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 C Media with a short position of Huang Hsiang. Check out your portfolio center. Please also check ongoing floating volatility patterns of C Media and Huang Hsiang.
Diversification Opportunities for C Media and Huang Hsiang
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 6237 and Huang is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding C Media Electronics and Huang Hsiang Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huang Hsiang Construction and C Media 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 C Media Electronics are associated (or correlated) with Huang Hsiang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huang Hsiang Construction has no effect on the direction of C Media i.e., C Media and Huang Hsiang go up and down completely randomly.
Pair Corralation between C Media and Huang Hsiang
Assuming the 90 days trading horizon C Media Electronics is expected to under-perform the Huang Hsiang. But the stock apears to be less risky and, when comparing its historical volatility, C Media Electronics is 1.87 times less risky than Huang Hsiang. The stock trades about -0.05 of its potential returns per unit of risk. The Huang Hsiang Construction is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 6,680 in Huang Hsiang Construction on September 13, 2024 and sell it today you would lose (80.00) from holding Huang Hsiang Construction or give up 1.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
C Media Electronics vs. Huang Hsiang Construction
Performance |
| Timeline |
| C Media Electronics |
| Huang Hsiang Construction |
C Media and Huang Hsiang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with C Media and Huang Hsiang
The main advantage of trading using opposite C Media and Huang Hsiang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if C Media position performs unexpectedly, Huang Hsiang 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 Huang Hsiang will offset losses from the drop in Huang Hsiang's long position.| C Media vs. WIN Semiconductors | C Media vs. GlobalWafers Co | C Media vs. Novatek Microelectronics Corp | C Media vs. Ruentex Development Co |
| Huang Hsiang vs. Chong Hong Construction | Huang Hsiang vs. Ruentex Development Co | Huang Hsiang vs. Symtek Automation Asia | Huang Hsiang vs. WiseChip Semiconductor |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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