Correlation Between Wei Chuan and Shieh Yih
Can any of the company-specific risk be diversified away by investing in both Wei Chuan and Shieh Yih 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 Wei Chuan and Shieh Yih into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wei Chuan Foods and Shieh Yih Machinery, you can compare the effects of market volatilities on Wei Chuan and Shieh Yih 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 Wei Chuan with a short position of Shieh Yih. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wei Chuan and Shieh Yih.
Diversification Opportunities for Wei Chuan and Shieh Yih
Very good diversification
The 3 months correlation between Wei and Shieh is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Wei Chuan Foods and Shieh Yih Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shieh Yih Machinery and Wei Chuan 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 Wei Chuan Foods are associated (or correlated) with Shieh Yih. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shieh Yih Machinery has no effect on the direction of Wei Chuan i.e., Wei Chuan and Shieh Yih go up and down completely randomly.
Pair Corralation between Wei Chuan and Shieh Yih
Assuming the 90 days trading horizon Wei Chuan Foods is expected to under-perform the Shieh Yih. But the stock apears to be less risky and, when comparing its historical volatility, Wei Chuan Foods is 5.55 times less risky than Shieh Yih. The stock trades about -0.02 of its potential returns per unit of risk. The Shieh Yih Machinery is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,013 in Shieh Yih Machinery on September 24, 2024 and sell it today you would earn a total of 2,887 from holding Shieh Yih Machinery or generate 285.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Wei Chuan Foods vs. Shieh Yih Machinery
Performance |
Timeline |
Wei Chuan Foods |
Shieh Yih Machinery |
Wei Chuan and Shieh Yih Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Wei Chuan and Shieh Yih
The main advantage of trading using opposite Wei Chuan and Shieh Yih positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wei Chuan position performs unexpectedly, Shieh Yih 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 Shieh Yih will offset losses from the drop in Shieh Yih's long position.Wei Chuan vs. Taisun Enterprise Co | Wei Chuan vs. De Licacy Industrial | Wei Chuan vs. Wisher Industrial Co | Wei Chuan vs. Tainan Enterprises Co |
Shieh Yih vs. Min Aik Technology | Shieh Yih vs. V Tac Technology Co | Shieh Yih vs. Wei Chuan Foods | Shieh Yih vs. Sun Max Tech |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
Bonds Directory Find actively traded corporate debentures issued by US companies |