Correlation Between Symtek Automation and Huang Hsiang

Can any of the company-specific risk be diversified away by investing in both Symtek Automation and Huang Hsiang 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 Symtek Automation and Huang Hsiang into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Symtek Automation Asia and Huang Hsiang Construction, you can compare the effects of market volatilities on Symtek Automation and Huang Hsiang 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 Symtek Automation with a short position of Huang Hsiang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Symtek Automation and Huang Hsiang.

Diversification Opportunities for Symtek Automation and Huang Hsiang

0.47

Correlation Coefficient

Symtek Automation  Huang Hsiang

Very weak diversification

The 3 months correlation between Symtek and Huang is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Symtek Automation Asia and Huang Hsiang Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huang Hsiang Construction and Symtek Automation 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 Symtek Automation Asia are associated (or correlated) with Huang Hsiang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huang Hsiang Construction has no effect on the direction of Symtek Automation i.e., Symtek Automation and Huang Hsiang go up and down completely randomly.

Pair Corralation between Symtek Automation and Huang Hsiang

Assuming the 90 days trading horizon Symtek Automation Asia is expected to generate 1.41 times more return on investment than Huang Hsiang. However, Symtek Automation is 1.41 times more volatile than Huang Hsiang Construction. It trades about 0.26 of its potential returns per unit of risk. Huang Hsiang Construction is currently generating about 0.18 per unit of risk. If you would invest  11,800  in Symtek Automation Asia on September 4, 2024 and sell it today you would earn a total of  8,800  from holding Symtek Automation Asia or generate 74.58% return on investment over 90 days.

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

Symtek Automation Asia  vs.  Huang Hsiang Construction

Symtek Automation Asia

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Symtek Automation Asia are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Symtek Automation showed solid returns over the last few months and may actually be approaching a breakup point.

Huang Hsiang Construction

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Huang Hsiang Construction are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Huang Hsiang showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Symtek Automation and Huang Hsiang

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

The idea behind Symtek Automation Asia and Huang Hsiang Construction 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.