Correlation Between Taita Chemical and Phoenix Silicon

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

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

Diversification Opportunities for Taita Chemical and Phoenix Silicon

-0.67

Correlation Coefficient

Taita Chemical  Phoenix Silicon

Excellent diversification

The 3 months correlation between Taita and Phoenix is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Taita Chemical Co and Phoenix Silicon International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phoenix Silicon Inte and Taita Chemical 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 Taita Chemical Co are associated (or correlated) with Phoenix Silicon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phoenix Silicon Inte has no effect on the direction of Taita Chemical i.e., Taita Chemical and Phoenix Silicon go up and down completely randomly.

Pair Corralation between Taita Chemical and Phoenix Silicon

Assuming the 90 days trading horizon Taita Chemical Co is expected to under-perform the Phoenix Silicon. But the stock apears to be less risky and, when comparing its historical volatility, Taita Chemical Co is 5.36 times less risky than Phoenix Silicon. The stock trades about -0.07 of its potential returns per unit of risk. The Phoenix Silicon International is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  7,356  in Phoenix Silicon International on May 8, 2025 and sell it today you would earn a total of  9,044  from holding Phoenix Silicon International or generate 122.95% return on investment over 90 days.

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

Taita Chemical Co  vs.  Phoenix Silicon International

Taita Chemical

Risk-Adjusted Performance

Weakest

Over the last 90 days Taita Chemical Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Phoenix Silicon Inte

Risk-Adjusted Performance

Good

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

Pair Trading with Taita Chemical and Phoenix Silicon

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

The idea behind Taita Chemical Co and Phoenix Silicon International 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.