Correlation Between Tung Thih and Mosa Industrial

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

Diversification Opportunities for Tung Thih and Mosa Industrial

0.34

Correlation Coefficient

Tung Thih  Mosa Industrial

Weak diversification

The 3 months correlation between Tung and Mosa is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Tung Thih Electronic and Mosa Industrial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mosa Industrial Corp 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 Mosa Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mosa Industrial Corp has no effect on the direction of Tung Thih i.e., Tung Thih and Mosa Industrial go up and down completely randomly.

Pair Corralation between Tung Thih and Mosa Industrial

Assuming the 90 days trading horizon Tung Thih Electronic is expected to under-perform the Mosa Industrial. But the stock apears to be less risky and, when comparing its historical volatility, Tung Thih Electronic is 1.45 times less risky than Mosa Industrial. The stock trades about -0.14 of its potential returns per unit of risk. The Mosa Industrial Corp is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  2,190  in Mosa Industrial Corp on December 27, 2024 and sell it today you would earn a total of  175.00  from holding Mosa Industrial Corp or generate 7.99% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Tung Thih Electronic  vs.  Mosa Industrial Corp

Tung Thih Electronic

Risk-Adjusted Performance

Very Weak

Over the last 90 days Tung Thih Electronic has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Mosa Industrial Corp

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Mosa Industrial Corp are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Mosa Industrial may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Tung Thih and Mosa Industrial

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

The idea behind Tung Thih Electronic and Mosa Industrial Corp 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.