Correlation Between PChome Online and Yuan High

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both PChome Online and Yuan High 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 Yuan High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PChome Online and Yuan High Tech Development, you can compare the effects of market volatilities on PChome Online and Yuan High 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 Yuan High. Check out your portfolio center. Please also check ongoing floating volatility patterns of PChome Online and Yuan High.

Diversification Opportunities for PChome Online and Yuan High

-0.44
  Correlation Coefficient

Very good diversification

The 3 months correlation between PChome and Yuan is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding PChome Online and Yuan High Tech Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yuan High Tech 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 Yuan High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yuan High Tech has no effect on the direction of PChome Online i.e., PChome Online and Yuan High go up and down completely randomly.

Pair Corralation between PChome Online and Yuan High

Assuming the 90 days trading horizon PChome Online is expected to under-perform the Yuan High. In addition to that, PChome Online is 1.27 times more volatile than Yuan High Tech Development. It trades about -0.07 of its total potential returns per unit of risk. Yuan High Tech Development is currently generating about 0.15 per unit of volatility. If you would invest  15,850  in Yuan High Tech Development on October 6, 2024 and sell it today you would earn a total of  3,400  from holding Yuan High Tech Development or generate 21.45% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

PChome Online  vs.  Yuan High Tech Development

 Performance 
       Timeline  
PChome Online 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in PChome Online are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, PChome Online showed solid returns over the last few months and may actually be approaching a breakup point.
Yuan High Tech 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Yuan High Tech Development are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Yuan High showed solid returns over the last few months and may actually be approaching a breakup point.

PChome Online and Yuan High Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with PChome Online and Yuan High

The main advantage of trading using opposite PChome Online and Yuan High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PChome Online position performs unexpectedly, Yuan High 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 Yuan High will offset losses from the drop in Yuan High's long position.
The idea behind PChome Online and Yuan High Tech Development 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.
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.

Other Complementary Tools

Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Insider Screener
Find insiders across different sectors to evaluate their impact on performance
Share Portfolio
Track or share privately all of your investments from the convenience of any device
Portfolio Volatility
Check portfolio volatility and analyze historical return density to properly model market risk
Bonds Directory
Find actively traded corporate debentures issued by US companies