Correlation Between CEOTRONICS (CEKSG) and REGAL ASIAN
Can any of the company-specific risk be diversified away by investing in both CEOTRONICS (CEKSG) and REGAL ASIAN 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 CEOTRONICS (CEKSG) and REGAL ASIAN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CEOTRONICS and REGAL ASIAN INVESTMENTS, you can compare the effects of market volatilities on CEOTRONICS (CEKSG) and REGAL ASIAN 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 CEOTRONICS (CEKSG) with a short position of REGAL ASIAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of CEOTRONICS (CEKSG) and REGAL ASIAN.
Diversification Opportunities for CEOTRONICS (CEKSG) and REGAL ASIAN
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between CEOTRONICS and REGAL is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding CEOTRONICS and REGAL ASIAN INVESTMENTS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on REGAL ASIAN INVESTMENTS and CEOTRONICS (CEKSG) 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 CEOTRONICS are associated (or correlated) with REGAL ASIAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of REGAL ASIAN INVESTMENTS has no effect on the direction of CEOTRONICS (CEKSG) i.e., CEOTRONICS (CEKSG) and REGAL ASIAN go up and down completely randomly.
Pair Corralation between CEOTRONICS (CEKSG) and REGAL ASIAN
Assuming the 90 days trading horizon CEOTRONICS is expected to generate 2.08 times more return on investment than REGAL ASIAN. However, CEOTRONICS (CEKSG) is 2.08 times more volatile than REGAL ASIAN INVESTMENTS. It trades about 0.25 of its potential returns per unit of risk. REGAL ASIAN INVESTMENTS is currently generating about 0.48 per unit of risk. If you would invest 605.00 in CEOTRONICS on November 28, 2024 and sell it today you would earn a total of 95.00 from holding CEOTRONICS or generate 15.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
CEOTRONICS vs. REGAL ASIAN INVESTMENTS
Performance |
| Timeline |
| CEOTRONICS (CEKSG) |
| REGAL ASIAN INVESTMENTS |
CEOTRONICS (CEKSG) and REGAL ASIAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CEOTRONICS (CEKSG) and REGAL ASIAN
The main advantage of trading using opposite CEOTRONICS (CEKSG) and REGAL ASIAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CEOTRONICS (CEKSG) position performs unexpectedly, REGAL ASIAN 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 REGAL ASIAN will offset losses from the drop in REGAL ASIAN's long position.| CEOTRONICS (CEKSG) vs. REGAL ASIAN INVESTMENTS | CEOTRONICS (CEKSG) vs. Platinum Investment Management | CEOTRONICS (CEKSG) vs. New Residential Investment | CEOTRONICS (CEKSG) vs. STMicroelectronics NV |
| REGAL ASIAN vs. Richardson Electronics | REGAL ASIAN vs. METHODE ELECTRONICS | REGAL ASIAN vs. STMicroelectronics NV | REGAL ASIAN vs. Agilent Technologies |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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