Correlation Between YuantaP Shares and BenQ Medical
Can any of the company-specific risk be diversified away by investing in both YuantaP Shares and BenQ Medical 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 BenQ Medical 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 BenQ Medical Technology, you can compare the effects of market volatilities on YuantaP Shares and BenQ Medical 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 BenQ Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of YuantaP Shares and BenQ Medical.
Diversification Opportunities for YuantaP Shares and BenQ Medical
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between YuantaP and BenQ is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding YuantaP shares Taiwan Mid Cap and BenQ Medical Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BenQ Medical Technology 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 BenQ Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BenQ Medical Technology has no effect on the direction of YuantaP Shares i.e., YuantaP Shares and BenQ Medical go up and down completely randomly.
Pair Corralation between YuantaP Shares and BenQ Medical
Assuming the 90 days trading horizon YuantaP shares Taiwan Mid Cap is expected to generate 0.64 times more return on investment than BenQ Medical. However, YuantaP shares Taiwan Mid Cap is 1.57 times less risky than BenQ Medical. It trades about 0.08 of its potential returns per unit of risk. BenQ Medical Technology is currently generating about -0.03 per unit of risk. If you would invest 5,300 in YuantaP shares Taiwan Mid Cap on September 4, 2024 and sell it today you would earn a total of 2,445 from holding YuantaP shares Taiwan Mid Cap or generate 46.13% 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. BenQ Medical Technology
Performance |
| Timeline |
| YuantaP shares Taiwan |
| BenQ Medical Technology |
YuantaP Shares and BenQ Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YuantaP Shares and BenQ Medical
The main advantage of trading using opposite YuantaP Shares and BenQ Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YuantaP Shares position performs unexpectedly, BenQ Medical 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 BenQ Medical will offset losses from the drop in BenQ Medical's long position.| YuantaP Shares vs. Cathay Taiwan 5G | YuantaP Shares vs. Ruentex Development Co | YuantaP Shares vs. Symtek Automation Asia | YuantaP Shares vs. CTCI Corp |
| BenQ Medical vs. StShine Optical Co | BenQ Medical vs. Bioteque | BenQ Medical vs. TTY Biopharm Co | BenQ Medical vs. Apex Biotechnology 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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