Correlation Between Ruentex Development and Inmax Holding
Can any of the company-specific risk be diversified away by investing in both Ruentex Development and Inmax Holding 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 Ruentex Development and Inmax Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ruentex Development Co and Inmax Holding Co, you can compare the effects of market volatilities on Ruentex Development and Inmax Holding 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 Ruentex Development with a short position of Inmax Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ruentex Development and Inmax Holding.
Diversification Opportunities for Ruentex Development and Inmax Holding
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ruentex and Inmax is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Ruentex Development Co and Inmax Holding Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inmax Holding and Ruentex Development 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 Ruentex Development Co are associated (or correlated) with Inmax Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inmax Holding has no effect on the direction of Ruentex Development i.e., Ruentex Development and Inmax Holding go up and down completely randomly.
Pair Corralation between Ruentex Development and Inmax Holding
Assuming the 90 days trading horizon Ruentex Development Co is expected to under-perform the Inmax Holding. But the stock apears to be less risky and, when comparing its historical volatility, Ruentex Development Co is 4.36 times less risky than Inmax Holding. The stock trades about -0.16 of its potential returns per unit of risk. The Inmax Holding Co is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 5,500 in Inmax Holding Co on September 13, 2024 and sell it today you would lose (130.00) from holding Inmax Holding Co or give up 2.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ruentex Development Co vs. Inmax Holding Co
Performance |
| Timeline |
| Ruentex Development |
| Inmax Holding |
Ruentex Development and Inmax Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ruentex Development and Inmax Holding
The main advantage of trading using opposite Ruentex Development and Inmax Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ruentex Development position performs unexpectedly, Inmax Holding 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 Inmax Holding will offset losses from the drop in Inmax Holding's long position.| Ruentex Development vs. Ruentex Industries | Ruentex Development vs. Pou Chen Corp | Ruentex Development vs. Fubon Financial Holding | Ruentex Development vs. Cathay Financial Holding |
| Inmax Holding vs. Hiwin Mikrosystem Corp | Inmax Holding vs. Ruentex Development Co | Inmax Holding vs. Symtek Automation Asia | Inmax Holding 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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