Correlation Between Giant Manufacturing and Symtek Automation
Can any of the company-specific risk be diversified away by investing in both Giant Manufacturing and Symtek Automation 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 Giant Manufacturing and Symtek Automation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Giant Manufacturing Co and Symtek Automation Asia, you can compare the effects of market volatilities on Giant Manufacturing and Symtek Automation 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 Giant Manufacturing with a short position of Symtek Automation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Giant Manufacturing and Symtek Automation.
Diversification Opportunities for Giant Manufacturing and Symtek Automation
-0.93 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Giant and Symtek is -0.93. Overlapping area represents the amount of risk that can be diversified away by holding Giant Manufacturing Co and Symtek Automation Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Symtek Automation Asia and Giant Manufacturing 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 Giant Manufacturing Co are associated (or correlated) with Symtek Automation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Symtek Automation Asia has no effect on the direction of Giant Manufacturing i.e., Giant Manufacturing and Symtek Automation go up and down completely randomly.
Pair Corralation between Giant Manufacturing and Symtek Automation
Assuming the 90 days trading horizon Giant Manufacturing Co is expected to under-perform the Symtek Automation. But the stock apears to be less risky and, when comparing its historical volatility, Giant Manufacturing Co is 1.87 times less risky than Symtek Automation. The stock trades about -0.38 of its potential returns per unit of risk. The Symtek Automation Asia is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 20,450 in Symtek Automation Asia on August 28, 2024 and sell it today you would earn a total of 2,000 from holding Symtek Automation Asia or generate 9.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Giant Manufacturing Co vs. Symtek Automation Asia
Performance |
| Timeline |
| Giant Manufacturing |
| Symtek Automation Asia |
Giant Manufacturing and Symtek Automation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Giant Manufacturing and Symtek Automation
The main advantage of trading using opposite Giant Manufacturing and Symtek Automation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Giant Manufacturing position performs unexpectedly, Symtek Automation 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 Symtek Automation will offset losses from the drop in Symtek Automation's long position.| Giant Manufacturing vs. Taiwan Semiconductor Manufacturing | Giant Manufacturing vs. Hon Hai Precision | Giant Manufacturing vs. MediaTek | Giant Manufacturing vs. Chunghwa Telecom Co |
| Symtek Automation vs. Golden Friends | Symtek Automation vs. Sunonwealth Electric Machine | Symtek Automation vs. Rechi Precision Co | Symtek Automation vs. C Sun Manufacturing |
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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