Correlation Between Ju Teng and Shih Kuen
Can any of the company-specific risk be diversified away by investing in both Ju Teng and Shih Kuen 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 Ju Teng and Shih Kuen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ju Teng International and Shih Kuen Plastics, you can compare the effects of market volatilities on Ju Teng and Shih Kuen 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 Ju Teng with a short position of Shih Kuen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ju Teng and Shih Kuen.
Diversification Opportunities for Ju Teng and Shih Kuen
Very weak diversification
The 3 months correlation between 9136 and Shih is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Ju Teng International and Shih Kuen Plastics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shih Kuen Plastics and Ju Teng 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 Ju Teng International are associated (or correlated) with Shih Kuen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shih Kuen Plastics has no effect on the direction of Ju Teng i.e., Ju Teng and Shih Kuen go up and down completely randomly.
Pair Corralation between Ju Teng and Shih Kuen
Assuming the 90 days trading horizon Ju Teng International is expected to generate 0.49 times more return on investment than Shih Kuen. However, Ju Teng International is 2.05 times less risky than Shih Kuen. It trades about -0.22 of its potential returns per unit of risk. Shih Kuen Plastics is currently generating about -0.23 per unit of risk. If you would invest 634.00 in Ju Teng International on August 30, 2024 and sell it today you would lose (21.00) from holding Ju Teng International or give up 3.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ju Teng International vs. Shih Kuen Plastics
Performance |
| Timeline |
| Ju Teng International |
| Shih Kuen Plastics |
Ju Teng and Shih Kuen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ju Teng and Shih Kuen
The main advantage of trading using opposite Ju Teng and Shih Kuen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ju Teng position performs unexpectedly, Shih Kuen 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 Shih Kuen will offset losses from the drop in Shih Kuen's long position.| Ju Teng vs. Advantech Co | Ju Teng vs. Asustek Computer | Ju Teng vs. Lite On Technology Corp | Ju Teng vs. Micro Star International Co |
| Shih Kuen vs. U Media Communications | Shih Kuen vs. Tainet Communication System | Shih Kuen vs. FDC International Hotels | Shih Kuen vs. Est Global Apparel |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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