Correlation Between Sangsin Energy and NewFlex Technology
Can any of the company-specific risk be diversified away by investing in both Sangsin Energy and NewFlex Technology 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 Sangsin Energy and NewFlex Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sangsin Energy Display and NewFlex Technology Co, you can compare the effects of market volatilities on Sangsin Energy and NewFlex Technology 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 Sangsin Energy with a short position of NewFlex Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sangsin Energy and NewFlex Technology.
Diversification Opportunities for Sangsin Energy and NewFlex Technology
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sangsin and NewFlex is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Sangsin Energy Display and NewFlex Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NewFlex Technology and Sangsin Energy 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 Sangsin Energy Display are associated (or correlated) with NewFlex Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NewFlex Technology has no effect on the direction of Sangsin Energy i.e., Sangsin Energy and NewFlex Technology go up and down completely randomly.
Pair Corralation between Sangsin Energy and NewFlex Technology
Assuming the 90 days trading horizon Sangsin Energy Display is expected to under-perform the NewFlex Technology. But the stock apears to be less risky and, when comparing its historical volatility, Sangsin Energy Display is 1.21 times less risky than NewFlex Technology. The stock trades about -0.11 of its potential returns per unit of risk. The NewFlex Technology Co is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 541,000 in NewFlex Technology Co on October 25, 2024 and sell it today you would earn a total of 11,000 from holding NewFlex Technology Co or generate 2.03% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Sangsin Energy Display vs. NewFlex Technology Co
Performance |
Timeline |
Sangsin Energy Display |
NewFlex Technology |
Sangsin Energy and NewFlex Technology Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sangsin Energy and NewFlex Technology
The main advantage of trading using opposite Sangsin Energy and NewFlex Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sangsin Energy position performs unexpectedly, NewFlex Technology 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 NewFlex Technology will offset losses from the drop in NewFlex Technology's long position.Sangsin Energy vs. SeAH Besteel Corp | Sangsin Energy vs. Insun Environment New | Sangsin Energy vs. PlayD Co | Sangsin Energy vs. Aprogen Healthcare Games |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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