Correlation Between I Chiun and Everlight Electronics

Can any of the company-specific risk be diversified away by investing in both I Chiun and Everlight 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 I Chiun and Everlight Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between I Chiun Precision Industry and Everlight Electronics Co, you can compare the effects of market volatilities on I Chiun and Everlight 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 I Chiun with a short position of Everlight Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of I Chiun and Everlight Electronics.

Diversification Opportunities for I Chiun and Everlight Electronics

0.37

Correlation Coefficient

I Chiun  Everlight Electronics

Weak diversification

The 3 months correlation between 2486 and Everlight is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding I Chiun Precision Industry and Everlight Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everlight Electronics and I Chiun 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 I Chiun Precision Industry are associated (or correlated) with Everlight Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everlight Electronics has no effect on the direction of I Chiun i.e., I Chiun and Everlight Electronics go up and down completely randomly.

Pair Corralation between I Chiun and Everlight Electronics

Assuming the 90 days trading horizon I Chiun Precision Industry is expected to generate 1.56 times more return on investment than Everlight Electronics. However, I Chiun is 1.56 times more volatile than Everlight Electronics Co. It trades about 0.15 of its potential returns per unit of risk. Everlight Electronics Co is currently generating about 0.02 per unit of risk. If you would invest  9,140  in I Chiun Precision Industry on September 15, 2024 and sell it today you would earn a total of  2,910  from holding I Chiun Precision Industry or generate 31.84% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

I Chiun Precision Industry  vs.  Everlight Electronics Co

I Chiun Precision

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in I Chiun Precision Industry are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, I Chiun showed solid returns over the last few months and may actually be approaching a breakup point.

Everlight Electronics

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Everlight Electronics Co are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Everlight Electronics is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with I Chiun and Everlight Electronics

The main advantage of trading using opposite I Chiun and Everlight Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if I Chiun position performs unexpectedly, Everlight 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 Everlight Electronics will offset losses from the drop in Everlight Electronics' long position.

The idea behind I Chiun Precision Industry and Everlight Electronics Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.