Correlation Between Century Iron and Swancor Holding
Can any of the company-specific risk be diversified away by investing in both Century Iron and Swancor 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 Century Iron and Swancor Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Century Iron And and Swancor Holding Co, you can compare the effects of market volatilities on Century Iron and Swancor 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 Century Iron with a short position of Swancor Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Century Iron and Swancor Holding.
Diversification Opportunities for Century Iron and Swancor Holding
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Century and Swancor is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Century Iron And and Swancor Holding Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swancor Holding and Century Iron 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 Century Iron And are associated (or correlated) with Swancor Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swancor Holding has no effect on the direction of Century Iron i.e., Century Iron and Swancor Holding go up and down completely randomly.
Pair Corralation between Century Iron and Swancor Holding
Assuming the 90 days trading horizon Century Iron And is expected to under-perform the Swancor Holding. In addition to that, Century Iron is 1.39 times more volatile than Swancor Holding Co. It trades about -0.18 of its total potential returns per unit of risk. Swancor Holding Co is currently generating about -0.13 per unit of volatility. If you would invest 9,050 in Swancor Holding Co on October 21, 2024 and sell it today you would lose (540.00) from holding Swancor Holding Co or give up 5.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Century Iron And vs. Swancor Holding Co
Performance |
| Timeline |
| Century Iron And |
| Swancor Holding |
Century Iron and Swancor Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Century Iron and Swancor Holding
The main advantage of trading using opposite Century Iron and Swancor Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Century Iron position performs unexpectedly, Swancor 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 Swancor Holding will offset losses from the drop in Swancor Holding's long position.| Century Iron vs. Swancor Holding Co | Century Iron vs. Hsin Kuang Steel | Century Iron vs. Ta Chen Stainless | Century Iron vs. Chung Hung Steel |
| Swancor Holding vs. Century Iron And | Swancor Holding vs. Yeong Guan Energy | Swancor Holding vs. Chung Hsin Electric Machinery | Swancor Holding vs. Unimicron Technology 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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