Correlation Between Sanyo Chemical and GAMING FAC
Can any of the company-specific risk be diversified away by investing in both Sanyo Chemical and GAMING FAC 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 Sanyo Chemical and GAMING FAC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sanyo Chemical Industries and GAMING FAC SA, you can compare the effects of market volatilities on Sanyo Chemical and GAMING FAC 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 Sanyo Chemical with a short position of GAMING FAC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sanyo Chemical and GAMING FAC.
Diversification Opportunities for Sanyo Chemical and GAMING FAC
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sanyo and GAMING is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Sanyo Chemical Industries and GAMING FAC SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GAMING FAC SA and Sanyo Chemical 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 Sanyo Chemical Industries are associated (or correlated) with GAMING FAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GAMING FAC SA has no effect on the direction of Sanyo Chemical i.e., Sanyo Chemical and GAMING FAC go up and down completely randomly.
Pair Corralation between Sanyo Chemical and GAMING FAC
Assuming the 90 days horizon Sanyo Chemical is expected to generate 4.8 times less return on investment than GAMING FAC. But when comparing it to its historical volatility, Sanyo Chemical Industries is 2.2 times less risky than GAMING FAC. It trades about 0.01 of its potential returns per unit of risk. GAMING FAC SA is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 162.00 in GAMING FAC SA on September 22, 2024 and sell it today you would earn a total of 0.00 from holding GAMING FAC SA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sanyo Chemical Industries vs. GAMING FAC SA
Performance |
| Timeline |
| Sanyo Chemical Industries |
| GAMING FAC SA |
Sanyo Chemical and GAMING FAC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sanyo Chemical and GAMING FAC
The main advantage of trading using opposite Sanyo Chemical and GAMING FAC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sanyo Chemical position performs unexpectedly, GAMING FAC 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 GAMING FAC will offset losses from the drop in GAMING FAC's long position.| Sanyo Chemical vs. Linde plc | Sanyo Chemical vs. Linde PLC | Sanyo Chemical vs. Air Liquide SA | Sanyo Chemical vs. The Sherwin Williams |
| GAMING FAC vs. Kaufman Broad SA | GAMING FAC vs. Sanyo Chemical Industries | GAMING FAC vs. BROADWIND ENRGY | GAMING FAC vs. Soken Chemical Engineering |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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