Correlation Between Song Ho and Jentech Precision
Can any of the company-specific risk be diversified away by investing in both Song Ho and Jentech Precision 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 Song Ho and Jentech Precision into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Song Ho Industrial and Jentech Precision Industrial, you can compare the effects of market volatilities on Song Ho and Jentech Precision 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 Song Ho with a short position of Jentech Precision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Song Ho and Jentech Precision.
Diversification Opportunities for Song Ho and Jentech Precision
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Song and Jentech is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Song Ho Industrial and Jentech Precision Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jentech Precision and Song Ho 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 Song Ho Industrial are associated (or correlated) with Jentech Precision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jentech Precision has no effect on the direction of Song Ho i.e., Song Ho and Jentech Precision go up and down completely randomly.
Pair Corralation between Song Ho and Jentech Precision
Assuming the 90 days trading horizon Song Ho Industrial is expected to under-perform the Jentech Precision. But the stock apears to be less risky and, when comparing its historical volatility, Song Ho Industrial is 8.14 times less risky than Jentech Precision. The stock trades about -0.06 of its potential returns per unit of risk. The Jentech Precision Industrial is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 150,000 in Jentech Precision Industrial on September 25, 2024 and sell it today you would lose (500.00) from holding Jentech Precision Industrial or give up 0.33% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Song Ho Industrial vs. Jentech Precision Industrial
Performance |
Timeline |
Song Ho Industrial |
Jentech Precision |
Song Ho and Jentech Precision Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Song Ho and Jentech Precision
The main advantage of trading using opposite Song Ho and Jentech Precision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Song Ho position performs unexpectedly, Jentech Precision 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 Jentech Precision will offset losses from the drop in Jentech Precision's long position.Song Ho vs. Universal Microelectronics Co | Song Ho vs. Asia Metal Industries | Song Ho vs. HOYA Resort Hotel | Song Ho vs. Camellia Metal Co |
Jentech Precision vs. Century Wind Power | Jentech Precision vs. Green World Fintech | Jentech Precision vs. Ingentec | Jentech Precision vs. Chaheng Precision 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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |