Correlation Between Ciwen Media and Hoshine Silicon

Can any of the company-specific risk be diversified away by investing in both Ciwen Media and Hoshine Silicon 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 Ciwen Media and Hoshine Silicon into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ciwen Media Co and Hoshine Silicon Ind, you can compare the effects of market volatilities on Ciwen Media and Hoshine Silicon 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 Ciwen Media with a short position of Hoshine Silicon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ciwen Media and Hoshine Silicon.

Diversification Opportunities for Ciwen Media and Hoshine Silicon

0.9

Correlation Coefficient

Ciwen Media  Hoshine Silicon

Almost no diversification

The 3 months correlation between Ciwen and Hoshine is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Ciwen Media Co and Hoshine Silicon Ind in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hoshine Silicon Ind and Ciwen Media 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 Ciwen Media Co are associated (or correlated) with Hoshine Silicon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hoshine Silicon Ind has no effect on the direction of Ciwen Media i.e., Ciwen Media and Hoshine Silicon go up and down completely randomly.

Pair Corralation between Ciwen Media and Hoshine Silicon

Assuming the 90 days trading horizon Ciwen Media Co is expected to generate 1.15 times more return on investment than Hoshine Silicon. However, Ciwen Media is 1.15 times more volatile than Hoshine Silicon Ind. It trades about 0.22 of its potential returns per unit of risk. Hoshine Silicon Ind is currently generating about 0.11 per unit of risk. If you would invest  499.00  in Ciwen Media Co on September 4, 2024 and sell it today you would earn a total of  263.00  from holding Ciwen Media Co or generate 52.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Ciwen Media Co  vs.  Hoshine Silicon Ind

Ciwen Media

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Ciwen Media Co are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Ciwen Media sustained solid returns over the last few months and may actually be approaching a breakup point.

Hoshine Silicon Ind

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Hoshine Silicon Ind are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Hoshine Silicon sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ciwen Media and Hoshine Silicon

The main advantage of trading using opposite Ciwen Media and Hoshine Silicon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ciwen Media position performs unexpectedly, Hoshine Silicon 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 Hoshine Silicon will offset losses from the drop in Hoshine Silicon's long position.

The idea behind Ciwen Media Co and Hoshine Silicon Ind 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.

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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.