Correlation Between Techshine Electronics and Universal Scientific

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Techshine Electronics and Universal Scientific 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 Techshine Electronics and Universal Scientific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Techshine Electronics Co and Universal Scientific Industrial, you can compare the effects of market volatilities on Techshine Electronics and Universal Scientific 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 Techshine Electronics with a short position of Universal Scientific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Techshine Electronics and Universal Scientific.

Diversification Opportunities for Techshine Electronics and Universal Scientific

0.63
  Correlation Coefficient

Poor diversification

The 3 months correlation between Techshine and Universal is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Techshine Electronics Co and Universal Scientific Industria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Scientific and Techshine Electronics 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 Techshine Electronics Co are associated (or correlated) with Universal Scientific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Scientific has no effect on the direction of Techshine Electronics i.e., Techshine Electronics and Universal Scientific go up and down completely randomly.

Pair Corralation between Techshine Electronics and Universal Scientific

Assuming the 90 days trading horizon Techshine Electronics Co is expected to generate 1.42 times more return on investment than Universal Scientific. However, Techshine Electronics is 1.42 times more volatile than Universal Scientific Industrial. It trades about 0.13 of its potential returns per unit of risk. Universal Scientific Industrial is currently generating about 0.09 per unit of risk. If you would invest  1,656  in Techshine Electronics Co on September 26, 2024 and sell it today you would earn a total of  479.00  from holding Techshine Electronics Co or generate 28.93% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Techshine Electronics Co  vs.  Universal Scientific Industria

 Performance 
       Timeline  
Techshine Electronics 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Techshine Electronics Co are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Techshine Electronics sustained solid returns over the last few months and may actually be approaching a breakup point.
Universal Scientific 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Universal Scientific Industrial are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Universal Scientific sustained solid returns over the last few months and may actually be approaching a breakup point.

Techshine Electronics and Universal Scientific Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Techshine Electronics and Universal Scientific

The main advantage of trading using opposite Techshine Electronics and Universal Scientific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Techshine Electronics position performs unexpectedly, Universal Scientific 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 Universal Scientific will offset losses from the drop in Universal Scientific's long position.
The idea behind Techshine Electronics Co and Universal Scientific Industrial 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.
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.

Other Complementary Tools

Funds Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
Performance Analysis
Check effects of mean-variance optimization against your current asset allocation
Portfolio File Import
Quickly import all of your third-party portfolios from your local drive in csv format
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
Economic Indicators
Top statistical indicators that provide insights into how an economy is performing