Correlation Between Ruentex Development and YungShin Global
Can any of the company-specific risk be diversified away by investing in both Ruentex Development and YungShin Global 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 YungShin Global 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 YungShin Global Holding, you can compare the effects of market volatilities on Ruentex Development and YungShin Global 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 YungShin Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ruentex Development and YungShin Global.
Diversification Opportunities for Ruentex Development and YungShin Global
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ruentex and YungShin is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Ruentex Development Co and YungShin Global Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YungShin Global 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 YungShin Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YungShin Global Holding has no effect on the direction of Ruentex Development i.e., Ruentex Development and YungShin Global go up and down completely randomly.
Pair Corralation between Ruentex Development and YungShin Global
Assuming the 90 days trading horizon Ruentex Development Co is expected to under-perform the YungShin Global. But the stock apears to be less risky and, when comparing its historical volatility, Ruentex Development Co is 1.37 times less risky than YungShin Global. The stock trades about -0.22 of its potential returns per unit of risk. The YungShin Global Holding is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 5,480 in YungShin Global Holding on September 12, 2024 and sell it today you would earn a total of 40.00 from holding YungShin Global Holding or generate 0.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ruentex Development Co vs. YungShin Global Holding
Performance |
| Timeline |
| Ruentex Development |
| YungShin Global Holding |
Ruentex Development and YungShin Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ruentex Development and YungShin Global
The main advantage of trading using opposite Ruentex Development and YungShin Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ruentex Development position performs unexpectedly, YungShin Global 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 YungShin Global will offset losses from the drop in YungShin Global's long position.| Ruentex Development vs. Chong Hong Construction | Ruentex Development vs. Symtek Automation Asia | Ruentex Development vs. WiseChip Semiconductor | Ruentex Development vs. Novatek Microelectronics Corp |
| YungShin Global vs. Apex Biotechnology Corp | YungShin Global vs. Ruentex Development Co | YungShin Global vs. WiseChip Semiconductor | YungShin Global vs. Novatek Microelectronics Corp |
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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