Correlation Between YuantaP Shares and Taiwan Cogeneration
Can any of the company-specific risk be diversified away by investing in both YuantaP Shares and Taiwan Cogeneration 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 Taiwan Cogeneration 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 Taiwan Cogeneration Corp, you can compare the effects of market volatilities on YuantaP Shares and Taiwan Cogeneration 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 Taiwan Cogeneration. Check out your portfolio center. Please also check ongoing floating volatility patterns of YuantaP Shares and Taiwan Cogeneration.
Diversification Opportunities for YuantaP Shares and Taiwan Cogeneration
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between YuantaP and Taiwan is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding YuantaP shares Taiwan Top and Taiwan Cogeneration Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taiwan Cogeneration 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 Taiwan Cogeneration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taiwan Cogeneration Corp has no effect on the direction of YuantaP Shares i.e., YuantaP Shares and Taiwan Cogeneration go up and down completely randomly.
Pair Corralation between YuantaP Shares and Taiwan Cogeneration
Assuming the 90 days trading horizon YuantaP shares Taiwan Top is expected to generate 1.24 times more return on investment than Taiwan Cogeneration. However, YuantaP Shares is 1.24 times more volatile than Taiwan Cogeneration Corp. It trades about 0.07 of its potential returns per unit of risk. Taiwan Cogeneration Corp is currently generating about -0.03 per unit of risk. If you would invest 18,300 in YuantaP shares Taiwan Top on August 28, 2024 and sell it today you would earn a total of 935.00 from holding YuantaP shares Taiwan Top or generate 5.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.16% |
| Values | Daily Returns |
YuantaP shares Taiwan Top vs. Taiwan Cogeneration Corp
Performance |
| Timeline |
| YuantaP shares Taiwan |
| Taiwan Cogeneration Corp |
YuantaP Shares and Taiwan Cogeneration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YuantaP Shares and Taiwan Cogeneration
The main advantage of trading using opposite YuantaP Shares and Taiwan Cogeneration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YuantaP Shares position performs unexpectedly, Taiwan Cogeneration 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 Taiwan Cogeneration will offset losses from the drop in Taiwan Cogeneration'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 |
| Taiwan Cogeneration vs. Taiwan Secom Co | Taiwan Cogeneration vs. Taiwan Shin Kong | Taiwan Cogeneration vs. Leatec Fine Ceramics | Taiwan Cogeneration vs. Information Technology Total |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |