Correlation Between Sanko Diecasting and Power Solution
Can any of the company-specific risk be diversified away by investing in both Sanko Diecasting and Power Solution 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 Sanko Diecasting and Power Solution into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sanko Diecasting Public and Power Solution Technologies, you can compare the effects of market volatilities on Sanko Diecasting and Power Solution 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 Sanko Diecasting with a short position of Power Solution. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sanko Diecasting and Power Solution.
Diversification Opportunities for Sanko Diecasting and Power Solution
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sanko and Power is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Sanko Diecasting Public and Power Solution Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Power Solution Techn and Sanko Diecasting 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 Sanko Diecasting Public are associated (or correlated) with Power Solution. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Power Solution Techn has no effect on the direction of Sanko Diecasting i.e., Sanko Diecasting and Power Solution go up and down completely randomly.
Pair Corralation between Sanko Diecasting and Power Solution
Assuming the 90 days trading horizon Sanko Diecasting Public is expected to under-perform the Power Solution. But the stock apears to be less risky and, when comparing its historical volatility, Sanko Diecasting Public is 1.6 times less risky than Power Solution. The stock trades about -0.11 of its potential returns per unit of risk. The Power Solution Technologies is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 47.00 in Power Solution Technologies on November 5, 2024 and sell it today you would earn a total of 1.00 from holding Power Solution Technologies or generate 2.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sanko Diecasting Public vs. Power Solution Technologies
Performance |
| Timeline |
| Sanko Diecasting Public |
| Power Solution Techn |
Sanko Diecasting and Power Solution Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sanko Diecasting and Power Solution
The main advantage of trading using opposite Sanko Diecasting and Power Solution positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sanko Diecasting position performs unexpectedly, Power Solution 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 Power Solution will offset losses from the drop in Power Solution's long position.| Sanko Diecasting vs. Sea Oil Public | Sanko Diecasting vs. Rayong Wire Industries | Sanko Diecasting vs. Project Planning Service | Sanko Diecasting vs. Power Solution Technologies |
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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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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