Correlation Between Golden Long and Shin Ruenn

Can any of the company-specific risk be diversified away by investing in both Golden Long and Shin Ruenn 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 Golden Long and Shin Ruenn into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Golden Long Teng and Shin Ruenn Development, you can compare the effects of market volatilities on Golden Long and Shin Ruenn 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 Golden Long with a short position of Shin Ruenn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Long and Shin Ruenn.

Diversification Opportunities for Golden Long and Shin Ruenn

0.93

Correlation Coefficient

Golden Long  Shin Ruenn

Almost no diversification

The 3 months correlation between Golden and Shin is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Golden Long Teng and Shin Ruenn Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shin Ruenn Development and Golden Long 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 Golden Long Teng are associated (or correlated) with Shin Ruenn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shin Ruenn Development has no effect on the direction of Golden Long i.e., Golden Long and Shin Ruenn go up and down completely randomly.

Pair Corralation between Golden Long and Shin Ruenn

Assuming the 90 days trading horizon Golden Long Teng is expected to generate 1.15 times more return on investment than Shin Ruenn. However, Golden Long is 1.15 times more volatile than Shin Ruenn Development. It trades about 0.1 of its potential returns per unit of risk. Shin Ruenn Development is currently generating about 0.07 per unit of risk. If you would invest  2,660  in Golden Long Teng on September 21, 2024 and sell it today you would earn a total of  130.00  from holding Golden Long Teng or generate 4.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	95.65%
Values	Daily Returns

Golden Long Teng  vs.  Shin Ruenn Development

Golden Long Teng

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Golden Long Teng has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Shin Ruenn Development

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Shin Ruenn Development has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Golden Long and Shin Ruenn

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

The idea behind Golden Long Teng and Shin Ruenn Development 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.