Correlation Between PChome Online and Est Global
Can any of the company-specific risk be diversified away by investing in both PChome Online and Est Global 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 PChome Online and Est Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PChome Online and Est Global Apparel, you can compare the effects of market volatilities on PChome Online and Est Global 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 PChome Online with a short position of Est Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of PChome Online and Est Global.
Diversification Opportunities for PChome Online and Est Global
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between PChome and Est is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding PChome Online and Est Global Apparel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Est Global Apparel and PChome Online 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 PChome Online are associated (or correlated) with Est Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Est Global Apparel has no effect on the direction of PChome Online i.e., PChome Online and Est Global go up and down completely randomly.
Pair Corralation between PChome Online and Est Global
Assuming the 90 days trading horizon PChome Online is expected to generate 1.68 times more return on investment than Est Global. However, PChome Online is 1.68 times more volatile than Est Global Apparel. It trades about 0.24 of its potential returns per unit of risk. Est Global Apparel is currently generating about 0.04 per unit of risk. If you would invest 2,985 in PChome Online on September 17, 2024 and sell it today you would earn a total of 2,305 from holding PChome Online or generate 77.22% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
PChome Online vs. Est Global Apparel
Performance |
Timeline |
PChome Online |
Est Global Apparel |
PChome Online and Est Global Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PChome Online and Est Global
The main advantage of trading using opposite PChome Online and Est Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PChome Online position performs unexpectedly, Est Global 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 Est Global will offset losses from the drop in Est Global's long position.PChome Online vs. momo Inc | PChome Online vs. President Chain Store | PChome Online vs. Uni President Enterprises Corp | PChome Online vs. Taiwan FamilyMart Co |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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