Correlation Between Ta Chen and Yieh Phui
Can any of the company-specific risk be diversified away by investing in both Ta Chen and Yieh Phui 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 Ta Chen and Yieh Phui into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ta Chen Stainless and Yieh Phui Enterprise, you can compare the effects of market volatilities on Ta Chen and Yieh Phui 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 Ta Chen with a short position of Yieh Phui. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ta Chen and Yieh Phui.
Diversification Opportunities for Ta Chen and Yieh Phui
Almost no diversification
The 3 months correlation between 2027 and Yieh is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Ta Chen Stainless and Yieh Phui Enterprise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yieh Phui Enterprise and Ta Chen 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 Ta Chen Stainless are associated (or correlated) with Yieh Phui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yieh Phui Enterprise has no effect on the direction of Ta Chen i.e., Ta Chen and Yieh Phui go up and down completely randomly.
Pair Corralation between Ta Chen and Yieh Phui
Assuming the 90 days trading horizon Ta Chen Stainless is expected to generate 1.52 times more return on investment than Yieh Phui. However, Ta Chen is 1.52 times more volatile than Yieh Phui Enterprise. It trades about 0.24 of its potential returns per unit of risk. Yieh Phui Enterprise is currently generating about 0.12 per unit of risk. If you would invest 3,435 in Ta Chen Stainless on December 2, 2024 and sell it today you would earn a total of 1,450 from holding Ta Chen Stainless or generate 42.21% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Ta Chen Stainless vs. Yieh Phui Enterprise
Performance |
Timeline |
Ta Chen Stainless |
Yieh Phui Enterprise |
Ta Chen and Yieh Phui Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ta Chen and Yieh Phui
The main advantage of trading using opposite Ta Chen and Yieh Phui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ta Chen position performs unexpectedly, Yieh Phui 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 Yieh Phui will offset losses from the drop in Yieh Phui's long position.Ta Chen vs. Chung Hung Steel | Ta Chen vs. China Steel Corp | Ta Chen vs. Tung Ho Steel | Ta Chen vs. Yang Ming Marine |
Yieh Phui vs. Chung Hung Steel | Yieh Phui vs. Tung Ho Steel | Yieh Phui vs. Sheng Yu Steel | Yieh Phui vs. China Steel Corp |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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