Correlation Between Pontex Polyblend and Hsinli Chemical
Can any of the company-specific risk be diversified away by investing in both Pontex Polyblend and Hsinli 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 Pontex Polyblend and Hsinli Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pontex Polyblend CoLtd and Hsinli Chemical Industrial, you can compare the effects of market volatilities on Pontex Polyblend and Hsinli 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 Pontex Polyblend with a short position of Hsinli Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pontex Polyblend and Hsinli Chemical.
Diversification Opportunities for Pontex Polyblend and Hsinli Chemical
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pontex and Hsinli is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Pontex Polyblend CoLtd and Hsinli Chemical Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hsinli Chemical Indu and Pontex Polyblend 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 Pontex Polyblend CoLtd are associated (or correlated) with Hsinli Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hsinli Chemical Indu has no effect on the direction of Pontex Polyblend i.e., Pontex Polyblend and Hsinli Chemical go up and down completely randomly.
Pair Corralation between Pontex Polyblend and Hsinli Chemical
Assuming the 90 days trading horizon Pontex Polyblend CoLtd is expected to under-perform the Hsinli Chemical. In addition to that, Pontex Polyblend is 1.34 times more volatile than Hsinli Chemical Industrial. It trades about 0.0 of its total potential returns per unit of risk. Hsinli Chemical Industrial is currently generating about 0.01 per unit of volatility. If you would invest 4,820 in Hsinli Chemical Industrial on October 12, 2024 and sell it today you would earn a total of 0.00 from holding Hsinli Chemical Industrial or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pontex Polyblend CoLtd vs. Hsinli Chemical Industrial
Performance |
| Timeline |
| Pontex Polyblend CoLtd |
| Hsinli Chemical Indu |
Pontex Polyblend and Hsinli Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pontex Polyblend and Hsinli Chemical
The main advantage of trading using opposite Pontex Polyblend and Hsinli Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pontex Polyblend position performs unexpectedly, Hsinli 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 Hsinli Chemical will offset losses from the drop in Hsinli Chemical's long position.| Pontex Polyblend vs. Rafael Microelectronics | Pontex Polyblend vs. Tehmag Foods | Pontex Polyblend vs. Ablerex Electronics Co | Pontex Polyblend vs. Everlight Electronics Co |
| Hsinli Chemical vs. Microelectronics Technology | Hsinli Chemical vs. Intai Technology | Hsinli Chemical vs. Pontex Polyblend CoLtd | Hsinli Chemical vs. Aker Technology 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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