Correlation Between Hwa Fong and Advanced Connection
Can any of the company-specific risk be diversified away by investing in both Hwa Fong and Advanced Connection 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 Hwa Fong and Advanced Connection into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hwa Fong Rubber and Advanced Connection, you can compare the effects of market volatilities on Hwa Fong and Advanced Connection 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 Hwa Fong with a short position of Advanced Connection. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hwa Fong and Advanced Connection.
Diversification Opportunities for Hwa Fong and Advanced Connection
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Hwa and Advanced is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Hwa Fong Rubber and Advanced Connection in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advanced Connection and Hwa Fong 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 Hwa Fong Rubber are associated (or correlated) with Advanced Connection. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advanced Connection has no effect on the direction of Hwa Fong i.e., Hwa Fong and Advanced Connection go up and down completely randomly.
Pair Corralation between Hwa Fong and Advanced Connection
Assuming the 90 days trading horizon Hwa Fong Rubber is expected to generate 9.02 times more return on investment than Advanced Connection. However, Hwa Fong is 9.02 times more volatile than Advanced Connection. It trades about 0.04 of its potential returns per unit of risk. Advanced Connection is currently generating about -0.02 per unit of risk. If you would invest 446.00 in Hwa Fong Rubber on December 4, 2024 and sell it today you would lose (40.00) from holding Hwa Fong Rubber or give up 8.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hwa Fong Rubber vs. Advanced Connection
Performance |
| Timeline |
| Hwa Fong Rubber |
| Advanced Connection |
Hwa Fong and Advanced Connection Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hwa Fong and Advanced Connection
The main advantage of trading using opposite Hwa Fong and Advanced Connection positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hwa Fong position performs unexpectedly, Advanced Connection 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 Advanced Connection will offset losses from the drop in Advanced Connection's long position.| Hwa Fong vs. Haad Thip Public | Hwa Fong vs. AAPICO Hitech Public | Hwa Fong vs. Inoue Rubber Public | Hwa Fong vs. Hana Microelectronics Public |
| Advanced Connection vs. Ekarat Engineering Public | Advanced Connection vs. Asia Green Energy | Advanced Connection vs. Better World Green | Advanced Connection vs. Aqua Public |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |