Correlation Between Chander Electronics and Tung Thih
Can any of the company-specific risk be diversified away by investing in both Chander Electronics and Tung Thih 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 Chander Electronics and Tung Thih into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chander Electronics Corp and Tung Thih Electronic, you can compare the effects of market volatilities on Chander Electronics and Tung Thih 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 Chander Electronics with a short position of Tung Thih. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chander Electronics and Tung Thih.
Diversification Opportunities for Chander Electronics and Tung Thih
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Chander and Tung is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Chander Electronics Corp and Tung Thih Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tung Thih Electronic and Chander Electronics 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 Chander Electronics Corp are associated (or correlated) with Tung Thih. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tung Thih Electronic has no effect on the direction of Chander Electronics i.e., Chander Electronics and Tung Thih go up and down completely randomly.
Pair Corralation between Chander Electronics and Tung Thih
Assuming the 90 days trading horizon Chander Electronics Corp is expected to under-perform the Tung Thih. But the stock apears to be less risky and, when comparing its historical volatility, Chander Electronics Corp is 2.19 times less risky than Tung Thih. The stock trades about -0.07 of its potential returns per unit of risk. The Tung Thih Electronic is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 9,970 in Tung Thih Electronic on September 1, 2024 and sell it today you would earn a total of 30.00 from holding Tung Thih Electronic or generate 0.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chander Electronics Corp vs. Tung Thih Electronic
Performance |
| Timeline |
| Chander Electronics Corp |
| Tung Thih Electronic |
Chander Electronics and Tung Thih Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chander Electronics and Tung Thih
The main advantage of trading using opposite Chander Electronics and Tung Thih positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chander Electronics position performs unexpectedly, Tung Thih 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 Tung Thih will offset losses from the drop in Tung Thih's long position.| Chander Electronics vs. Hon Hai Precision | Chander Electronics vs. Delta Electronics | Chander Electronics vs. LARGAN Precision Co | Chander Electronics vs. Yageo Corp |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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