An Approach of Stocks Substitution Strategy Using Fuzzy Interval Correlation Coefficient. Issue 4 (20th April 2016)

• Record Type: Journal Article
• Authors: Cheng, Yu-Ting; Yang, Chih-Ching
• Is Part Of: Communications in statistics. Volume 45:Issue 4(2016)
• Page Start: 1187
• Page End: 1196
• Publication Date: 2016-04-20
• Subjects: Fuzzy interval correlation -- Pearson's correlation coefficient -- Choosing Strategy; Mathematical statistics -- Periodicals; Mathematical statistics -- Data processing -- Periodicals; Digital computer simulation -- Periodicals; 519.5
• DOI: 10.1080/03610918.2013.780080
• Languages: English
• ISSNs: 0361-0918

Abstract

Abstract : The classical Pearson's correlation coefficient has been widely adopted in various fields of application. However, when the data are composed of fuzzy interval values, it is not feasible to use such a traditional approach to evaluate the correlation coefficient. In this study, we propose the specific calculation of fuzzy interval correlation coefficient with fuzzy interval data to measure the relationship between various stocks. As such, the study is able to offer an improving measure of investment strategy for stocks substitution via the analysis of the fuzzy interval correlation. In addition, we use empirical studies to verify the validity of our proposal on fuzzy interval correlation coefficient using data from companies in electric machinery and plastic sectors in Taiwan.