Correlation Between C Media and Taisol Electronics
Can any of the company-specific risk be diversified away by investing in both C Media and Taisol Electronics 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 Taisol Electronics 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 Taisol Electronics Co, you can compare the effects of market volatilities on C Media and Taisol Electronics 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 Taisol Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of C Media and Taisol Electronics.
Diversification Opportunities for C Media and Taisol Electronics
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between 6237 and Taisol is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding C Media Electronics and Taisol Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taisol Electronics 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 Taisol Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taisol Electronics has no effect on the direction of C Media i.e., C Media and Taisol Electronics go up and down completely randomly.
Pair Corralation between C Media and Taisol Electronics
Assuming the 90 days trading horizon C Media Electronics is expected to under-perform the Taisol Electronics. In addition to that, C Media is 1.06 times more volatile than Taisol Electronics Co. It trades about -0.02 of its total potential returns per unit of risk. Taisol Electronics Co is currently generating about 0.04 per unit of volatility. If you would invest 6,120 in Taisol Electronics Co on September 2, 2024 and sell it today you would earn a total of 1,220 from holding Taisol Electronics Co or generate 19.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
C Media Electronics vs. Taisol Electronics Co
Performance |
| Timeline |
| C Media Electronics |
| Taisol Electronics |
C Media and Taisol Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with C Media and Taisol Electronics
The main advantage of trading using opposite C Media and Taisol Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if C Media position performs unexpectedly, Taisol Electronics 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 Taisol Electronics will offset losses from the drop in Taisol Electronics' long position.| C Media vs. Dawushan Farm Tech | C Media vs. Standard Foods Corp | C Media vs. Lihtai Construction Enterprise | C Media vs. Central Reinsurance Corp |
| Taisol Electronics vs. Hon Hai Precision | Taisol Electronics vs. Delta Electronics | Taisol Electronics vs. LARGAN Precision Co | Taisol Electronics vs. Yageo Corp |
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 CEOs Directory module to screen CEOs from public companies around the world.
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