Correlation Between YuantaP Shares and S Tech
Can any of the company-specific risk be diversified away by investing in both YuantaP Shares and S Tech 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 YuantaP Shares and S Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YuantaP shares Taiwan Top and S Tech Corp, you can compare the effects of market volatilities on YuantaP Shares and S Tech 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 YuantaP Shares with a short position of S Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of YuantaP Shares and S Tech.
Diversification Opportunities for YuantaP Shares and S Tech
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between YuantaP and 1584 is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding YuantaP shares Taiwan Top and S Tech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on S Tech Corp and YuantaP Shares 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 YuantaP shares Taiwan Top are associated (or correlated) with S Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of S Tech Corp has no effect on the direction of YuantaP Shares i.e., YuantaP Shares and S Tech go up and down completely randomly.
Pair Corralation between YuantaP Shares and S Tech
Assuming the 90 days trading horizon YuantaP shares Taiwan Top is expected to generate 0.55 times more return on investment than S Tech. However, YuantaP shares Taiwan Top is 1.81 times less risky than S Tech. It trades about 0.11 of its potential returns per unit of risk. S Tech Corp is currently generating about 0.01 per unit of risk. If you would invest 11,229 in YuantaP shares Taiwan Top on November 1, 2024 and sell it today you would earn a total of 8,901 from holding YuantaP shares Taiwan Top or generate 79.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.71% |
| Values | Daily Returns |
YuantaP shares Taiwan Top vs. S Tech Corp
Performance |
| Timeline |
| YuantaP shares Taiwan |
| S Tech Corp |
YuantaP Shares and S Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YuantaP Shares and S Tech
The main advantage of trading using opposite YuantaP Shares and S Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YuantaP Shares position performs unexpectedly, S Tech 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 S Tech will offset losses from the drop in S Tech's long position.| YuantaP Shares vs. YuantaP shares MSCI Taiwan | YuantaP Shares vs. YuantaP shares Taiwan GreTai | YuantaP Shares vs. YuantaP shares SSE50 | YuantaP Shares vs. YuantaP shares Taiwan Mid Cap |
| S Tech vs. Formosa International Hotels | S Tech vs. Tait Marketing Distribution | S Tech vs. Formosa Chemicals Fibre | S Tech vs. Tehmag Foods |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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