Correlation Between Ching Feng and Central Reinsurance
Can any of the company-specific risk be diversified away by investing in both Ching Feng and Central Reinsurance 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 Ching Feng and Central Reinsurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ching Feng Home and Central Reinsurance Corp, you can compare the effects of market volatilities on Ching Feng and Central Reinsurance 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 Ching Feng with a short position of Central Reinsurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ching Feng and Central Reinsurance.
Diversification Opportunities for Ching Feng and Central Reinsurance
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ching and Central is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Ching Feng Home and Central Reinsurance Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Central Reinsurance Corp and Ching Feng 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 Ching Feng Home are associated (or correlated) with Central Reinsurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Central Reinsurance Corp has no effect on the direction of Ching Feng i.e., Ching Feng and Central Reinsurance go up and down completely randomly.
Pair Corralation between Ching Feng and Central Reinsurance
Assuming the 90 days trading horizon Ching Feng Home is expected to generate 1.59 times more return on investment than Central Reinsurance. However, Ching Feng is 1.59 times more volatile than Central Reinsurance Corp. It trades about 0.06 of its potential returns per unit of risk. Central Reinsurance Corp is currently generating about 0.08 per unit of risk. If you would invest 1,755 in Ching Feng Home on September 26, 2024 and sell it today you would earn a total of 1,235 from holding Ching Feng Home or generate 70.37% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Ching Feng Home vs. Central Reinsurance Corp
Performance |
Timeline |
Ching Feng Home |
Central Reinsurance Corp |
Ching Feng and Central Reinsurance Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ching Feng and Central Reinsurance
The main advantage of trading using opposite Ching Feng and Central Reinsurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ching Feng position performs unexpectedly, Central Reinsurance 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 Central Reinsurance will offset losses from the drop in Central Reinsurance's long position.Ching Feng vs. Merida Industry Co | Ching Feng vs. Cheng Shin Rubber | Ching Feng vs. Uni President Enterprises Corp | Ching Feng vs. Pou Chen Corp |
Central Reinsurance vs. Ching Feng Home | Central Reinsurance vs. Tai Tung Communication | Central Reinsurance vs. Chernan Metal Industrial | Central Reinsurance vs. Dadi Early Childhood Education |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
Fundamental Analysis View fundamental data based on most recent published financial statements |