Correlation Between YuantaP Shares and Kinsus Interconnect
Can any of the company-specific risk be diversified away by investing in both YuantaP Shares and Kinsus Interconnect 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 Kinsus Interconnect into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YuantaP shares Taiwan Mid Cap and Kinsus Interconnect Technology, you can compare the effects of market volatilities on YuantaP Shares and Kinsus Interconnect 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 Kinsus Interconnect. Check out your portfolio center. Please also check ongoing floating volatility patterns of YuantaP Shares and Kinsus Interconnect.
Diversification Opportunities for YuantaP Shares and Kinsus Interconnect
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between YuantaP and Kinsus is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding YuantaP shares Taiwan Mid Cap and Kinsus Interconnect Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinsus Interconnect 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 Mid Cap are associated (or correlated) with Kinsus Interconnect. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinsus Interconnect has no effect on the direction of YuantaP Shares i.e., YuantaP Shares and Kinsus Interconnect go up and down completely randomly.
Pair Corralation between YuantaP Shares and Kinsus Interconnect
Assuming the 90 days trading horizon YuantaP shares Taiwan Mid Cap is expected to generate 0.45 times more return on investment than Kinsus Interconnect. However, YuantaP shares Taiwan Mid Cap is 2.2 times less risky than Kinsus Interconnect. It trades about 0.08 of its potential returns per unit of risk. Kinsus Interconnect Technology is currently generating about -0.01 per unit of risk. If you would invest 5,255 in YuantaP shares Taiwan Mid Cap on August 30, 2024 and sell it today you would earn a total of 2,415 from holding YuantaP shares Taiwan Mid Cap or generate 45.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
YuantaP shares Taiwan Mid Cap vs. Kinsus Interconnect Technology
Performance |
| Timeline |
| YuantaP shares Taiwan |
| Kinsus Interconnect |
YuantaP Shares and Kinsus Interconnect Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YuantaP Shares and Kinsus Interconnect
The main advantage of trading using opposite YuantaP Shares and Kinsus Interconnect positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YuantaP Shares position performs unexpectedly, Kinsus Interconnect 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 Kinsus Interconnect will offset losses from the drop in Kinsus Interconnect's long position.| YuantaP Shares vs. YuantaP shares Taiwan Top | YuantaP Shares vs. Yuanta Daily Taiwan | YuantaP Shares vs. Symtek Automation Asia | YuantaP Shares vs. CTCI Corp |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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