Correlation Between Shin Hai and Oceanic Beverages
Can any of the company-specific risk be diversified away by investing in both Shin Hai and Oceanic Beverages 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 Shin Hai and Oceanic Beverages into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shin Hai Gas and Oceanic Beverages Co, you can compare the effects of market volatilities on Shin Hai and Oceanic Beverages 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 Shin Hai with a short position of Oceanic Beverages. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shin Hai and Oceanic Beverages.
Diversification Opportunities for Shin Hai and Oceanic Beverages
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Shin and Oceanic is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Shin Hai Gas and Oceanic Beverages Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oceanic Beverages and Shin Hai 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 Shin Hai Gas are associated (or correlated) with Oceanic Beverages. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oceanic Beverages has no effect on the direction of Shin Hai i.e., Shin Hai and Oceanic Beverages go up and down completely randomly.
Pair Corralation between Shin Hai and Oceanic Beverages
Assuming the 90 days trading horizon Shin Hai Gas is expected to generate 0.39 times more return on investment than Oceanic Beverages. However, Shin Hai Gas is 2.57 times less risky than Oceanic Beverages. It trades about 0.08 of its potential returns per unit of risk. Oceanic Beverages Co is currently generating about -0.1 per unit of risk. If you would invest 5,110 in Shin Hai Gas on November 4, 2024 and sell it today you would earn a total of 30.00 from holding Shin Hai Gas or generate 0.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shin Hai Gas vs. Oceanic Beverages Co
Performance |
| Timeline |
| Shin Hai Gas |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Oceanic Beverages |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
Shin Hai and Oceanic Beverages Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shin Hai and Oceanic Beverages
The main advantage of trading using opposite Shin Hai and Oceanic Beverages positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shin Hai position performs unexpectedly, Oceanic Beverages 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 Oceanic Beverages will offset losses from the drop in Oceanic Beverages' long position.The idea behind Shin Hai Gas and Oceanic Beverages Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |