Correlation Between Ton Yi and Chenming Mold
Can any of the company-specific risk be diversified away by investing in both Ton Yi and Chenming Mold 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 Ton Yi and Chenming Mold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ton Yi Industrial and Chenming Mold Industrial, you can compare the effects of market volatilities on Ton Yi and Chenming Mold 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 Ton Yi with a short position of Chenming Mold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ton Yi and Chenming Mold.
Diversification Opportunities for Ton Yi and Chenming Mold
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ton and Chenming is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Ton Yi Industrial and Chenming Mold Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chenming Mold Industrial and Ton Yi 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 Ton Yi Industrial are associated (or correlated) with Chenming Mold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chenming Mold Industrial has no effect on the direction of Ton Yi i.e., Ton Yi and Chenming Mold go up and down completely randomly.
Pair Corralation between Ton Yi and Chenming Mold
Assuming the 90 days trading horizon Ton Yi Industrial is expected to generate 0.35 times more return on investment than Chenming Mold. However, Ton Yi Industrial is 2.83 times less risky than Chenming Mold. It trades about -0.07 of its potential returns per unit of risk. Chenming Mold Industrial is currently generating about -0.19 per unit of risk. If you would invest 1,595 in Ton Yi Industrial on September 13, 2024 and sell it today you would lose (30.00) from holding Ton Yi Industrial or give up 1.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ton Yi Industrial vs. Chenming Mold Industrial
Performance |
| Timeline |
| Ton Yi Industrial |
| Chenming Mold Industrial |
Ton Yi and Chenming Mold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ton Yi and Chenming Mold
The main advantage of trading using opposite Ton Yi and Chenming Mold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ton Yi position performs unexpectedly, Chenming Mold 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 Chenming Mold will offset losses from the drop in Chenming Mold's long position.| Ton Yi vs. Tainan Spinning Co | Ton Yi vs. Lealea Enterprise Co | Ton Yi vs. China Petrochemical Development | Ton Yi vs. Ruentex Development Co |
| Chenming Mold vs. AU Optronics | Chenming Mold vs. Innolux Corp | Chenming Mold vs. Ruentex Development Co | Chenming Mold vs. WiseChip Semiconductor |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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