Correlation Between Casing Macron and Sentronic International
Can any of the company-specific risk be diversified away by investing in both Casing Macron and Sentronic International 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 Casing Macron and Sentronic International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Casing Macron Technology and Sentronic International, you can compare the effects of market volatilities on Casing Macron and Sentronic International 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 Casing Macron with a short position of Sentronic International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Casing Macron and Sentronic International.
Diversification Opportunities for Casing Macron and Sentronic International
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Casing and Sentronic is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Casing Macron Technology and Sentronic International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sentronic International and Casing Macron 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 Casing Macron Technology are associated (or correlated) with Sentronic International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sentronic International has no effect on the direction of Casing Macron i.e., Casing Macron and Sentronic International go up and down completely randomly.
Pair Corralation between Casing Macron and Sentronic International
Assuming the 90 days trading horizon Casing Macron Technology is expected to generate 1.15 times more return on investment than Sentronic International. However, Casing Macron is 1.15 times more volatile than Sentronic International. It trades about -0.05 of its potential returns per unit of risk. Sentronic International is currently generating about -0.1 per unit of risk. If you would invest 2,225 in Casing Macron Technology on September 16, 2024 and sell it today you would lose (225.00) from holding Casing Macron Technology or give up 10.11% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Casing Macron Technology vs. Sentronic International
Performance |
Timeline |
Casing Macron Technology |
Sentronic International |
Casing Macron and Sentronic International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Casing Macron and Sentronic International
The main advantage of trading using opposite Casing Macron and Sentronic International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Casing Macron position performs unexpectedly, Sentronic International 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 Sentronic International will offset losses from the drop in Sentronic International's long position.Casing Macron vs. Niching Industrial | Casing Macron vs. Dimension Computer Technology | Casing Macron vs. Kworld Computer Co | Casing Macron vs. Ruentex Development Co |
Sentronic International vs. Niching Industrial | Sentronic International vs. Dimension Computer Technology | Sentronic International vs. Kworld Computer Co | Sentronic International vs. Ruentex Development Co |
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 Stocks Directory module to find actively traded stocks across global markets.
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