Correlation Between GungHo Online and TOREX SEMICONDUCTOR
Can any of the company-specific risk be diversified away by investing in both GungHo Online and TOREX SEMICONDUCTOR 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 GungHo Online and TOREX SEMICONDUCTOR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GungHo Online Entertainment and TOREX SEMICONDUCTOR LTD, you can compare the effects of market volatilities on GungHo Online and TOREX SEMICONDUCTOR 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 GungHo Online with a short position of TOREX SEMICONDUCTOR. Check out your portfolio center. Please also check ongoing floating volatility patterns of GungHo Online and TOREX SEMICONDUCTOR.
Diversification Opportunities for GungHo Online and TOREX SEMICONDUCTOR
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between GungHo and TOREX is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding GungHo Online Entertainment and TOREX SEMICONDUCTOR LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TOREX SEMICONDUCTOR LTD and GungHo 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 GungHo Online Entertainment are associated (or correlated) with TOREX SEMICONDUCTOR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TOREX SEMICONDUCTOR LTD has no effect on the direction of GungHo Online i.e., GungHo Online and TOREX SEMICONDUCTOR go up and down completely randomly.
Pair Corralation between GungHo Online and TOREX SEMICONDUCTOR
Assuming the 90 days horizon GungHo Online Entertainment is expected to generate 0.89 times more return on investment than TOREX SEMICONDUCTOR. However, GungHo Online Entertainment is 1.12 times less risky than TOREX SEMICONDUCTOR. It trades about 0.05 of its potential returns per unit of risk. TOREX SEMICONDUCTOR LTD is currently generating about -0.06 per unit of risk. If you would invest 1,430 in GungHo Online Entertainment on September 26, 2024 and sell it today you would earn a total of 520.00 from holding GungHo Online Entertainment or generate 36.36% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
GungHo Online Entertainment vs. TOREX SEMICONDUCTOR LTD
Performance |
Timeline |
GungHo Online Entert |
TOREX SEMICONDUCTOR LTD |
GungHo Online and TOREX SEMICONDUCTOR Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with GungHo Online and TOREX SEMICONDUCTOR
The main advantage of trading using opposite GungHo Online and TOREX SEMICONDUCTOR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GungHo Online position performs unexpectedly, TOREX SEMICONDUCTOR 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 TOREX SEMICONDUCTOR will offset losses from the drop in TOREX SEMICONDUCTOR's long position.GungHo Online vs. Lifeway Foods | GungHo Online vs. Harmony Gold Mining | GungHo Online vs. Tyson Foods | GungHo Online vs. GEELY AUTOMOBILE |
TOREX SEMICONDUCTOR vs. COMMERCIAL VEHICLE | TOREX SEMICONDUCTOR vs. GungHo Online Entertainment | TOREX SEMICONDUCTOR vs. Nucletron Electronic Aktiengesellschaft | TOREX SEMICONDUCTOR vs. CarsalesCom |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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