Correlation Between Phoenix Silicon and Taita Chemical
Can any of the company-specific risk be diversified away by investing in both Phoenix Silicon and Taita Chemical 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 Phoenix Silicon and Taita Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Phoenix Silicon International and Taita Chemical Co, you can compare the effects of market volatilities on Phoenix Silicon and Taita Chemical 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 Phoenix Silicon with a short position of Taita Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phoenix Silicon and Taita Chemical.
Diversification Opportunities for Phoenix Silicon and Taita Chemical
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Phoenix and Taita is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Phoenix Silicon International and Taita Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taita Chemical and Phoenix Silicon 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 Phoenix Silicon International are associated (or correlated) with Taita Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taita Chemical has no effect on the direction of Phoenix Silicon i.e., Phoenix Silicon and Taita Chemical go up and down completely randomly.
Pair Corralation between Phoenix Silicon and Taita Chemical
Assuming the 90 days trading horizon Phoenix Silicon International is expected to generate 2.03 times more return on investment than Taita Chemical. However, Phoenix Silicon is 2.03 times more volatile than Taita Chemical Co. It trades about 0.11 of its potential returns per unit of risk. Taita Chemical Co is currently generating about -0.26 per unit of risk. If you would invest 12,250 in Phoenix Silicon International on August 30, 2024 and sell it today you would earn a total of 1,000.00 from holding Phoenix Silicon International or generate 8.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Phoenix Silicon International vs. Taita Chemical Co
Performance |
| Timeline |
| Phoenix Silicon Inte |
| Taita Chemical |
Phoenix Silicon and Taita Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Phoenix Silicon and Taita Chemical
The main advantage of trading using opposite Phoenix Silicon and Taita Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Phoenix Silicon position performs unexpectedly, Taita Chemical 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 Taita Chemical will offset losses from the drop in Taita Chemical's long position.| Phoenix Silicon vs. Taiwan Semiconductor Manufacturing | Phoenix Silicon vs. MediaTek | Phoenix Silicon vs. United Microelectronics | Phoenix Silicon vs. Novatek Microelectronics Corp |
| Taita Chemical vs. China General Plastics | Taita Chemical vs. Asia Polymer Corp | Taita Chemical vs. USI Corp | Taita Chemical vs. Grand Pacific Petrochemical |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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