Correlation Between Green World and Hi Sharp
Can any of the company-specific risk be diversified away by investing in both Green World and Hi Sharp 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 Green World and Hi Sharp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Green World Fintech and Hi Sharp Electronics, you can compare the effects of market volatilities on Green World and Hi Sharp 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 Green World with a short position of Hi Sharp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Green World and Hi Sharp.
Diversification Opportunities for Green World and Hi Sharp
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Green and 3128 is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Green World Fintech and Hi Sharp Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hi Sharp Electronics and Green World 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 Green World Fintech are associated (or correlated) with Hi Sharp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hi Sharp Electronics has no effect on the direction of Green World i.e., Green World and Hi Sharp go up and down completely randomly.
Pair Corralation between Green World and Hi Sharp
Assuming the 90 days trading horizon Green World Fintech is expected to generate 1.45 times more return on investment than Hi Sharp. However, Green World is 1.45 times more volatile than Hi Sharp Electronics. It trades about 0.22 of its potential returns per unit of risk. Hi Sharp Electronics is currently generating about 0.14 per unit of risk. If you would invest 6,230 in Green World Fintech on November 29, 2024 and sell it today you would earn a total of 890.00 from holding Green World Fintech or generate 14.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Green World Fintech vs. Hi Sharp Electronics
Performance |
| Timeline |
| Green World Fintech |
| Hi Sharp Electronics |
Green World and Hi Sharp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Green World and Hi Sharp
The main advantage of trading using opposite Green World and Hi Sharp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Green World position performs unexpectedly, Hi Sharp 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 Hi Sharp will offset losses from the drop in Hi Sharp's long position.| Green World vs. Te Chang Construction | Green World vs. An Shin Food Services | Green World vs. Shieh Yih Machinery | Green World vs. Strong H Machinery |
| Hi Sharp vs. Emerging Display Technologies | Hi Sharp vs. Great Computer | Hi Sharp vs. Feng Ching Metal | Hi Sharp vs. Easywell Biomedicals |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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