Correlation Between Ruentex Development and Symtek Automation
Can any of the company-specific risk be diversified away by investing in both Ruentex Development 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 Ruentex Development and Symtek Automation 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 Symtek Automation Asia, you can compare the effects of market volatilities on Ruentex Development 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 Ruentex Development with a short position of Symtek Automation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ruentex Development and Symtek Automation.
Diversification Opportunities for Ruentex Development and Symtek Automation
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ruentex and Symtek is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Ruentex Development 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 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 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 Ruentex Development i.e., Ruentex Development and Symtek Automation go up and down completely randomly.
Pair Corralation between Ruentex Development and Symtek Automation
Assuming the 90 days trading horizon Ruentex Development is expected to generate 18.96 times less return on investment than Symtek Automation. But when comparing it to its historical volatility, Ruentex Development Co is 1.39 times less risky than Symtek Automation. It trades about 0.01 of its potential returns per unit of risk. Symtek Automation Asia is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 8,678 in Symtek Automation Asia on November 19, 2024 and sell it today you would earn a total of 13,072 from holding Symtek Automation Asia or generate 150.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ruentex Development Co vs. Symtek Automation Asia
Performance |
| Timeline |
| Ruentex Development |
| Symtek Automation Asia |
Ruentex Development and Symtek Automation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ruentex Development and Symtek Automation
The main advantage of trading using opposite Ruentex Development and Symtek Automation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ruentex Development 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.| Ruentex Development vs. Ruentex Industries | Ruentex Development vs. Pou Chen Corp | Ruentex Development vs. Fubon Financial Holding | Ruentex Development vs. Cathay Financial Holding |
| Symtek Automation vs. Foxsemicon Integrated Technology | Symtek Automation vs. United Integrated Services | Symtek Automation vs. Ennostar | Symtek Automation vs. All Ring Tech |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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