Correlation Between CKM Building and Shinkong Insurance
Can any of the company-specific risk be diversified away by investing in both CKM Building and Shinkong Insurance 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 CKM Building and Shinkong Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CKM Building Material and Shinkong Insurance Co, you can compare the effects of market volatilities on CKM Building and Shinkong Insurance 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 CKM Building with a short position of Shinkong Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of CKM Building and Shinkong Insurance.
Diversification Opportunities for CKM Building and Shinkong Insurance
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CKM and Shinkong is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding CKM Building Material and Shinkong Insurance Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinkong Insurance and CKM Building 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 CKM Building Material are associated (or correlated) with Shinkong Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinkong Insurance has no effect on the direction of CKM Building i.e., CKM Building and Shinkong Insurance go up and down completely randomly.
Pair Corralation between CKM Building and Shinkong Insurance
Assuming the 90 days trading horizon CKM Building is expected to generate 1.81 times less return on investment than Shinkong Insurance. In addition to that, CKM Building is 1.06 times more volatile than Shinkong Insurance Co. It trades about 0.03 of its total potential returns per unit of risk. Shinkong Insurance Co is currently generating about 0.07 per unit of volatility. If you would invest 9,940 in Shinkong Insurance Co on October 26, 2024 and sell it today you would earn a total of 460.00 from holding Shinkong Insurance Co or generate 4.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CKM Building Material vs. Shinkong Insurance Co
Performance |
| Timeline |
| CKM Building Material |
| Shinkong Insurance |
CKM Building and Shinkong Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CKM Building and Shinkong Insurance
The main advantage of trading using opposite CKM Building and Shinkong Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CKM Building position performs unexpectedly, Shinkong Insurance 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 Shinkong Insurance will offset losses from the drop in Shinkong Insurance's long position.| CKM Building vs. Farglory FTZ Investment | CKM Building vs. Elitegroup Computer Systems | CKM Building vs. WinMate Communication INC | CKM Building vs. Mercuries Life Insurance |
| Shinkong Insurance vs. Central Reinsurance Corp | Shinkong Insurance vs. Huaku Development Co | Shinkong Insurance vs. Fubon Financial Holding | Shinkong Insurance vs. Chailease Holding 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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