Correlation Between Chicony Power and Silicon Power
Can any of the company-specific risk be diversified away by investing in both Chicony Power and Silicon Power 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 Chicony Power and Silicon Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chicony Power Technology and Silicon Power Computer, you can compare the effects of market volatilities on Chicony Power and Silicon Power 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 Chicony Power with a short position of Silicon Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chicony Power and Silicon Power.
Diversification Opportunities for Chicony Power and Silicon Power
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Chicony and Silicon is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Chicony Power Technology and Silicon Power Computer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silicon Power Computer and Chicony Power 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 Chicony Power Technology are associated (or correlated) with Silicon Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silicon Power Computer has no effect on the direction of Chicony Power i.e., Chicony Power and Silicon Power go up and down completely randomly.
Pair Corralation between Chicony Power and Silicon Power
Assuming the 90 days trading horizon Chicony Power Technology is expected to generate 1.19 times more return on investment than Silicon Power. However, Chicony Power is 1.19 times more volatile than Silicon Power Computer. It trades about 0.01 of its potential returns per unit of risk. Silicon Power Computer is currently generating about -0.01 per unit of risk. If you would invest 12,850 in Chicony Power Technology on September 2, 2024 and sell it today you would lose (50.00) from holding Chicony Power Technology or give up 0.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chicony Power Technology vs. Silicon Power Computer
Performance |
| Timeline |
| Chicony Power Technology |
| Silicon Power Computer |
Chicony Power and Silicon Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chicony Power and Silicon Power
The main advantage of trading using opposite Chicony Power and Silicon Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chicony Power position performs unexpectedly, Silicon Power 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 Silicon Power will offset losses from the drop in Silicon Power's long position.| Chicony Power vs. Ability Enterprise Co | Chicony Power vs. XAC Automation | Chicony Power vs. Cheng Fwa Industrial | Chicony Power vs. Kaulin Mfg |
| Silicon Power vs. Chicony Power Technology | Silicon Power vs. WinMate Communication INC | Silicon Power vs. Univacco Technology | Silicon Power vs. Genovate Biotechnology 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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