Correlation Between Ligitek Electronics and Prince Housing
Can any of the company-specific risk be diversified away by investing in both Ligitek Electronics and Prince Housing 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 Ligitek Electronics and Prince Housing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ligitek Electronics Co and Prince Housing Development, you can compare the effects of market volatilities on Ligitek Electronics and Prince Housing 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 Ligitek Electronics with a short position of Prince Housing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ligitek Electronics and Prince Housing.
Diversification Opportunities for Ligitek Electronics and Prince Housing
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ligitek and Prince is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Ligitek Electronics Co and Prince Housing Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prince Housing Devel and Ligitek 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 Ligitek Electronics Co are associated (or correlated) with Prince Housing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prince Housing Devel has no effect on the direction of Ligitek Electronics i.e., Ligitek Electronics and Prince Housing go up and down completely randomly.
Pair Corralation between Ligitek Electronics and Prince Housing
Assuming the 90 days trading horizon Ligitek Electronics Co is expected to generate 1.86 times more return on investment than Prince Housing. However, Ligitek Electronics is 1.86 times more volatile than Prince Housing Development. It trades about 0.08 of its potential returns per unit of risk. Prince Housing Development is currently generating about 0.01 per unit of risk. If you would invest 1,618 in Ligitek Electronics Co on August 26, 2024 and sell it today you would earn a total of 2,082 from holding Ligitek Electronics Co or generate 128.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Ligitek Electronics Co vs. Prince Housing Development
Performance |
| Timeline |
| Ligitek Electronics |
| Prince Housing Devel |
Ligitek Electronics and Prince Housing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ligitek Electronics and Prince Housing
The main advantage of trading using opposite Ligitek Electronics and Prince Housing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ligitek Electronics position performs unexpectedly, Prince Housing 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 Prince Housing will offset losses from the drop in Prince Housing's long position.| Ligitek Electronics vs. Leader Electronics | Ligitek Electronics vs. Simple Mart Retail | Ligitek Electronics vs. Grand Ocean Retail | Ligitek Electronics vs. Amazing Microelectronic |
| Prince Housing vs. Compal Electronics | Prince Housing vs. China Metal Products | Prince Housing vs. Ligitek Electronics Co | Prince Housing vs. Oceanic Beverages 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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