Correlation Between HIM International and BenQ Medical
Can any of the company-specific risk be diversified away by investing in both HIM International and BenQ Medical 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 HIM International and BenQ Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HIM International Music and BenQ Medical Technology, you can compare the effects of market volatilities on HIM International and BenQ Medical 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 HIM International with a short position of BenQ Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of HIM International and BenQ Medical.
Diversification Opportunities for HIM International and BenQ Medical
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between HIM and BenQ is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding HIM International Music and BenQ Medical Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BenQ Medical Technology and HIM International 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 HIM International Music are associated (or correlated) with BenQ Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BenQ Medical Technology has no effect on the direction of HIM International i.e., HIM International and BenQ Medical go up and down completely randomly.
Pair Corralation between HIM International and BenQ Medical
Assuming the 90 days trading horizon HIM International Music is expected to generate 1.17 times more return on investment than BenQ Medical. However, HIM International is 1.17 times more volatile than BenQ Medical Technology. It trades about 0.06 of its potential returns per unit of risk. BenQ Medical Technology is currently generating about -0.02 per unit of risk. If you would invest 7,894 in HIM International Music on November 28, 2024 and sell it today you would earn a total of 4,056 from holding HIM International Music or generate 51.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HIM International Music vs. BenQ Medical Technology
Performance |
| Timeline |
| HIM International Music |
| BenQ Medical Technology |
HIM International and BenQ Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HIM International and BenQ Medical
The main advantage of trading using opposite HIM International and BenQ Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HIM International position performs unexpectedly, BenQ Medical 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 BenQ Medical will offset losses from the drop in BenQ Medical's long position.| HIM International vs. Double Bond Chemical | HIM International vs. Asia Metal Industries | HIM International vs. Camellia Metal Co | HIM International vs. First Insurance Co |
| BenQ Medical vs. Mosa Industrial Corp | BenQ Medical vs. SS Healthcare Holding | BenQ Medical vs. Advanced Wireless Semiconductor | BenQ Medical vs. Formosa International Hotels |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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