Correlation Between Pegavision and Chi Sheng
Can any of the company-specific risk be diversified away by investing in both Pegavision and Chi Sheng 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 Pegavision and Chi Sheng into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pegavision and Chi Sheng Chemical, you can compare the effects of market volatilities on Pegavision and Chi Sheng 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 Pegavision with a short position of Chi Sheng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pegavision and Chi Sheng.
Diversification Opportunities for Pegavision and Chi Sheng
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Pegavision and Chi is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Pegavision and Chi Sheng Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chi Sheng Chemical and Pegavision 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 Pegavision are associated (or correlated) with Chi Sheng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chi Sheng Chemical has no effect on the direction of Pegavision i.e., Pegavision and Chi Sheng go up and down completely randomly.
Pair Corralation between Pegavision and Chi Sheng
Assuming the 90 days trading horizon Pegavision is expected to generate 1.18 times more return on investment than Chi Sheng. However, Pegavision is 1.18 times more volatile than Chi Sheng Chemical. It trades about 0.13 of its potential returns per unit of risk. Chi Sheng Chemical is currently generating about -0.03 per unit of risk. If you would invest 37,350 in Pegavision on November 28, 2024 and sell it today you would earn a total of 1,150 from holding Pegavision or generate 3.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pegavision vs. Chi Sheng Chemical
Performance |
| Timeline |
| Pegavision |
| Chi Sheng Chemical |
Pegavision and Chi Sheng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pegavision and Chi Sheng
The main advantage of trading using opposite Pegavision and Chi Sheng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pegavision position performs unexpectedly, Chi Sheng 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 Chi Sheng will offset losses from the drop in Chi Sheng's long position.| Pegavision vs. Asmedia Technology | Pegavision vs. Kinsus Interconnect Technology | Pegavision vs. Alchip Technologies | Pegavision vs. Lotes Co |
| Chi Sheng vs. CTBC Financial Holding | Chi Sheng vs. Hua Nan Financial | Chi Sheng vs. Shin Kong Financial | Chi Sheng vs. Song Ho Industrial |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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