Correlation Between Taiwan Shin and Shin Hai
Can any of the company-specific risk be diversified away by investing in both Taiwan Shin and Shin Hai 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 Taiwan Shin and Shin Hai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Taiwan Shin Kong and Shin Hai Gas, you can compare the effects of market volatilities on Taiwan Shin and Shin Hai 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 Taiwan Shin with a short position of Shin Hai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taiwan Shin and Shin Hai.
Diversification Opportunities for Taiwan Shin and Shin Hai
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Taiwan and Shin is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Taiwan Shin Kong and Shin Hai Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shin Hai Gas and Taiwan Shin 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 Taiwan Shin Kong are associated (or correlated) with Shin Hai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shin Hai Gas has no effect on the direction of Taiwan Shin i.e., Taiwan Shin and Shin Hai go up and down completely randomly.
Pair Corralation between Taiwan Shin and Shin Hai
Assuming the 90 days trading horizon Taiwan Shin Kong is expected to generate 0.94 times more return on investment than Shin Hai. However, Taiwan Shin Kong is 1.06 times less risky than Shin Hai. It trades about -0.02 of its potential returns per unit of risk. Shin Hai Gas is currently generating about -0.03 per unit of risk. If you would invest 4,210 in Taiwan Shin Kong on September 3, 2024 and sell it today you would lose (105.00) from holding Taiwan Shin Kong or give up 2.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Taiwan Shin Kong vs. Shin Hai Gas
Performance |
| Timeline |
| Taiwan Shin Kong |
| Shin Hai Gas |
Taiwan Shin and Shin Hai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Taiwan Shin and Shin Hai
The main advantage of trading using opposite Taiwan Shin and Shin Hai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taiwan Shin position performs unexpectedly, Shin Hai 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 Shin Hai will offset losses from the drop in Shin Hai's long position.| Taiwan Shin vs. Universal Microelectronics Co | Taiwan Shin vs. AVerMedia Technologies | Taiwan Shin vs. Symtek Automation Asia | Taiwan Shin vs. WiseChip Semiconductor |
| Shin Hai vs. Taiwan Secom Co | Shin Hai vs. Taiwan Shin Kong | Shin Hai vs. Taiwan Cogeneration Corp | Shin Hai vs. Shin Shin Natural |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |