Correlation Between Phytohealth Corp and Shieh Yih
Can any of the company-specific risk be diversified away by investing in both Phytohealth Corp and Shieh Yih 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 Phytohealth Corp and Shieh Yih into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Phytohealth Corp and Shieh Yih Machinery, you can compare the effects of market volatilities on Phytohealth Corp and Shieh Yih 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 Phytohealth Corp with a short position of Shieh Yih. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phytohealth Corp and Shieh Yih.
Diversification Opportunities for Phytohealth Corp and Shieh Yih
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Phytohealth and Shieh is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Phytohealth Corp and Shieh Yih Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shieh Yih Machinery and Phytohealth Corp 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 Phytohealth Corp are associated (or correlated) with Shieh Yih. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shieh Yih Machinery has no effect on the direction of Phytohealth Corp i.e., Phytohealth Corp and Shieh Yih go up and down completely randomly.
Pair Corralation between Phytohealth Corp and Shieh Yih
Assuming the 90 days trading horizon Phytohealth Corp is expected to under-perform the Shieh Yih. But the stock apears to be less risky and, when comparing its historical volatility, Phytohealth Corp is 1.43 times less risky than Shieh Yih. The stock trades about -0.18 of its potential returns per unit of risk. The Shieh Yih Machinery is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 3,815 in Shieh Yih Machinery on September 25, 2024 and sell it today you would earn a total of 55.00 from holding Shieh Yih Machinery or generate 1.44% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 95.45% |
Values | Daily Returns |
Phytohealth Corp vs. Shieh Yih Machinery
Performance |
Timeline |
Phytohealth Corp |
Shieh Yih Machinery |
Phytohealth Corp and Shieh Yih Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Phytohealth Corp and Shieh Yih
The main advantage of trading using opposite Phytohealth Corp and Shieh Yih positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Phytohealth Corp position performs unexpectedly, Shieh Yih 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 Shieh Yih will offset losses from the drop in Shieh Yih's long position.Phytohealth Corp vs. CHC Healthcare Group | Phytohealth Corp vs. GenMont Biotech | Phytohealth Corp vs. Sinphar Pharmaceutical Co | Phytohealth Corp vs. Abnova Taiwan Corp |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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