Correlation Between YuantaP Shares and Farglory FTZ
Can any of the company-specific risk be diversified away by investing in both YuantaP Shares and Farglory FTZ 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 Farglory FTZ 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 Farglory FTZ Investment, you can compare the effects of market volatilities on YuantaP Shares and Farglory FTZ 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 Farglory FTZ. Check out your portfolio center. Please also check ongoing floating volatility patterns of YuantaP Shares and Farglory FTZ.
Diversification Opportunities for YuantaP Shares and Farglory FTZ
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between YuantaP and Farglory is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding YuantaP shares Taiwan Mid Cap and Farglory FTZ Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Farglory FTZ Investment 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 Farglory FTZ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Farglory FTZ Investment has no effect on the direction of YuantaP Shares i.e., YuantaP Shares and Farglory FTZ go up and down completely randomly.
Pair Corralation between YuantaP Shares and Farglory FTZ
Assuming the 90 days trading horizon YuantaP shares Taiwan Mid Cap is expected to generate 0.5 times more return on investment than Farglory FTZ. However, YuantaP shares Taiwan Mid Cap is 2.02 times less risky than Farglory FTZ. It trades about 0.08 of its potential returns per unit of risk. Farglory FTZ Investment is currently generating about -0.01 per unit of risk. If you would invest 5,360 in YuantaP shares Taiwan Mid Cap on August 26, 2024 and sell it today you would earn a total of 2,480 from holding YuantaP shares Taiwan Mid Cap or generate 46.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
YuantaP shares Taiwan Mid Cap vs. Farglory FTZ Investment
Performance |
| Timeline |
| YuantaP shares Taiwan |
| Farglory FTZ Investment |
YuantaP Shares and Farglory FTZ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YuantaP Shares and Farglory FTZ
The main advantage of trading using opposite YuantaP Shares and Farglory FTZ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YuantaP Shares position performs unexpectedly, Farglory FTZ 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 Farglory FTZ will offset losses from the drop in Farglory FTZ's long position.| YuantaP Shares vs. YuantaP shares Taiwan Top | YuantaP Shares vs. Cathay Taiwan 5G | YuantaP Shares vs. Yuanta Daily CSI | YuantaP Shares vs. Fuh Hwa Emerging |
| Farglory FTZ vs. Evergreen International Storage | Farglory FTZ vs. China Container Terminal | Farglory FTZ vs. Sincere Navigation Corp | Farglory FTZ vs. CSBC Corp Taiwan |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |