Correlation Between Synnex Technology and King Yuan

Can any of the company-specific risk be diversified away by investing in both Synnex Technology and King Yuan 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 Synnex Technology and King Yuan into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Synnex Technology International and King Yuan Electronics, you can compare the effects of market volatilities on Synnex Technology and King Yuan 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 Synnex Technology with a short position of King Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Synnex Technology and King Yuan.

Diversification Opportunities for Synnex Technology and King Yuan

0.3

Correlation Coefficient

Synnex Technology  King Yuan

Weak diversification

The 3 months correlation between Synnex and King is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Synnex Technology Internationa and King Yuan Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on King Yuan Electronics and Synnex Technology 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 Synnex Technology International are associated (or correlated) with King Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of King Yuan Electronics has no effect on the direction of Synnex Technology i.e., Synnex Technology and King Yuan go up and down completely randomly.

Pair Corralation between Synnex Technology and King Yuan

Assuming the 90 days trading horizon Synnex Technology International is expected to generate 0.45 times more return on investment than King Yuan. However, Synnex Technology International is 2.2 times less risky than King Yuan. It trades about 0.08 of its potential returns per unit of risk. King Yuan Electronics is currently generating about 0.02 per unit of risk. If you would invest  7,010  in Synnex Technology International on September 13, 2024 and sell it today you would earn a total of  390.00  from holding Synnex Technology International or generate 5.56% return on investment over 90 days.

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

Synnex Technology Internationa  vs.  King Yuan Electronics

Synnex Technology

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Synnex Technology International are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Synnex Technology is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

King Yuan Electronics

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in King Yuan Electronics are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, King Yuan is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Synnex Technology and King Yuan

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

The idea behind Synnex Technology International and King Yuan Electronics 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.