Correlation Between Ocean Harvest and Compal Electronics
Can any of the company-specific risk be diversified away by investing in both Ocean Harvest and Compal Electronics 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 Ocean Harvest and Compal Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ocean Harvest Technology and Compal Electronics GDR, you can compare the effects of market volatilities on Ocean Harvest and Compal Electronics 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 Ocean Harvest with a short position of Compal Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ocean Harvest and Compal Electronics.
Diversification Opportunities for Ocean Harvest and Compal Electronics
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ocean and Compal is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ocean Harvest Technology and Compal Electronics GDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compal Electronics GDR and Ocean Harvest 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 Ocean Harvest Technology are associated (or correlated) with Compal Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compal Electronics GDR has no effect on the direction of Ocean Harvest i.e., Ocean Harvest and Compal Electronics go up and down completely randomly.
Pair Corralation between Ocean Harvest and Compal Electronics
Assuming the 90 days trading horizon Ocean Harvest Technology is expected to under-perform the Compal Electronics. In addition to that, Ocean Harvest is 1.37 times more volatile than Compal Electronics GDR. It trades about -0.05 of its total potential returns per unit of risk. Compal Electronics GDR is currently generating about 0.01 per unit of volatility. If you would invest 307.00 in Compal Electronics GDR on August 31, 2024 and sell it today you would earn a total of 3.00 from holding Compal Electronics GDR or generate 0.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Ocean Harvest Technology vs. Compal Electronics GDR
Performance |
| Timeline |
| Ocean Harvest Technology |
| Compal Electronics GDR |
Ocean Harvest and Compal Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ocean Harvest and Compal Electronics
The main advantage of trading using opposite Ocean Harvest and Compal Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ocean Harvest position performs unexpectedly, Compal Electronics 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 Compal Electronics will offset losses from the drop in Compal Electronics' long position.| Ocean Harvest vs. Quadrise Plc | Ocean Harvest vs. ImmuPharma PLC | Ocean Harvest vs. Intuitive Investments Group | Ocean Harvest vs. European Metals Holdings |
| Compal Electronics vs. The Mercantile Investment | Compal Electronics vs. International Consolidated Airlines | Compal Electronics vs. Team Internet Group | Compal Electronics vs. Taylor Maritime Investments |
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 CEOs Directory module to screen CEOs from public companies around the world.
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