Correlation Between Tung Thih and Hunt Electronic

Can any of the company-specific risk be diversified away by investing in both Tung Thih and Hunt Electronic 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 Hunt Electronic 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 Hunt Electronic Co, you can compare the effects of market volatilities on Tung Thih and Hunt Electronic 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 Hunt Electronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tung Thih and Hunt Electronic.

Diversification Opportunities for Tung Thih and Hunt Electronic

-0.52

Correlation Coefficient

Tung Thih  Hunt Electronic

Excellent diversification

The 3 months correlation between Tung and Hunt is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Tung Thih Electronic and Hunt Electronic Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hunt Electronic 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 Hunt Electronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hunt Electronic has no effect on the direction of Tung Thih i.e., Tung Thih and Hunt Electronic go up and down completely randomly.

Pair Corralation between Tung Thih and Hunt Electronic

Assuming the 90 days trading horizon Tung Thih Electronic is expected to under-perform the Hunt Electronic. But the stock apears to be less risky and, when comparing its historical volatility, Tung Thih Electronic is 1.86 times less risky than Hunt Electronic. The stock trades about -0.28 of its potential returns per unit of risk. The Hunt Electronic Co is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest  2,220  in Hunt Electronic Co on October 9, 2024 and sell it today you would lose (95.00) from holding Hunt Electronic Co or give up 4.28% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Tung Thih Electronic  vs.  Hunt Electronic Co

Tung Thih Electronic

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Tung Thih Electronic are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Tung Thih may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Hunt Electronic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hunt Electronic Co 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 February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Tung Thih and Hunt Electronic

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

The idea behind Tung Thih Electronic and Hunt Electronic 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.