Correlation Between Tung Thih and Kenda Rubber
Can any of the company-specific risk be diversified away by investing in both Tung Thih and Kenda Rubber 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 Tung Thih and Kenda Rubber into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tung Thih Electronic and Kenda Rubber Industrial, you can compare the effects of market volatilities on Tung Thih and Kenda Rubber 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 Tung Thih with a short position of Kenda Rubber. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tung Thih and Kenda Rubber.
Diversification Opportunities for Tung Thih and Kenda Rubber
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tung and Kenda is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Tung Thih Electronic and Kenda Rubber Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kenda Rubber Industrial and Tung Thih 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 Tung Thih Electronic are associated (or correlated) with Kenda Rubber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kenda Rubber Industrial has no effect on the direction of Tung Thih i.e., Tung Thih and Kenda Rubber go up and down completely randomly.
Pair Corralation between Tung Thih and Kenda Rubber
Assuming the 90 days trading horizon Tung Thih Electronic is expected to generate 59.3 times more return on investment than Kenda Rubber. However, Tung Thih is 59.3 times more volatile than Kenda Rubber Industrial. It trades about 0.06 of its potential returns per unit of risk. Kenda Rubber Industrial is currently generating about -0.03 per unit of risk. If you would invest 12,403 in Tung Thih Electronic on October 9, 2024 and sell it today you would lose (3,453) from holding Tung Thih Electronic or give up 27.84% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Tung Thih Electronic vs. Kenda Rubber Industrial
Performance |
Timeline |
Tung Thih Electronic |
Kenda Rubber Industrial |
Tung Thih and Kenda Rubber Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Tung Thih and Kenda Rubber
The main advantage of trading using opposite Tung Thih and Kenda Rubber positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tung Thih position performs unexpectedly, Kenda Rubber 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 Kenda Rubber will offset losses from the drop in Kenda Rubber's long position.Tung Thih vs. Hota Industrial Mfg | Tung Thih vs. BizLink Holding | Tung Thih vs. Cub Elecparts | Tung Thih vs. Hu Lane Associate |
Kenda Rubber vs. Ruentex Development Co | Kenda Rubber vs. WiseChip Semiconductor | Kenda Rubber vs. Leader Electronics | Kenda Rubber vs. CTCI 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
Content Syndication Quickly integrate customizable finance content to your own investment portal | |
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |