Correlation Between YuantaP Shares and Baotek Industrial
Can any of the company-specific risk be diversified away by investing in both YuantaP Shares and Baotek Industrial 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 Baotek Industrial 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 Baotek Industrial Materials, you can compare the effects of market volatilities on YuantaP Shares and Baotek Industrial 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 Baotek Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of YuantaP Shares and Baotek Industrial.
Diversification Opportunities for YuantaP Shares and Baotek Industrial
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between YuantaP and Baotek is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding YuantaP shares Taiwan Top and Baotek Industrial Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baotek Industrial 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 Baotek Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baotek Industrial has no effect on the direction of YuantaP Shares i.e., YuantaP Shares and Baotek Industrial go up and down completely randomly.
Pair Corralation between YuantaP Shares and Baotek Industrial
Assuming the 90 days trading horizon YuantaP shares Taiwan Top is expected to under-perform the Baotek Industrial. But the etf apears to be less risky and, when comparing its historical volatility, YuantaP shares Taiwan Top is 2.81 times less risky than Baotek Industrial. The etf trades about -0.03 of its potential returns per unit of risk. The Baotek Industrial Materials is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 4,350 in Baotek Industrial Materials on August 25, 2024 and sell it today you would earn a total of 190.00 from holding Baotek Industrial Materials or generate 4.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
YuantaP shares Taiwan Top vs. Baotek Industrial Materials
Performance |
| Timeline |
| YuantaP shares Taiwan |
| Baotek Industrial |
YuantaP Shares and Baotek Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YuantaP Shares and Baotek Industrial
The main advantage of trading using opposite YuantaP Shares and Baotek Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YuantaP Shares position performs unexpectedly, Baotek Industrial 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 Baotek Industrial will offset losses from the drop in Baotek Industrial'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 |
| Baotek Industrial vs. Eclat Textile Co | Baotek Industrial vs. Ruentex Industries | Baotek Industrial vs. Tainan Spinning Co | Baotek Industrial vs. Shinkong Synthetic Fiber |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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