Correlation Between YuantaP Shares and Luo Lih
Can any of the company-specific risk be diversified away by investing in both YuantaP Shares and Luo Lih 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 Luo Lih 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 Luo Lih Fen, you can compare the effects of market volatilities on YuantaP Shares and Luo Lih 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 Luo Lih. Check out your portfolio center. Please also check ongoing floating volatility patterns of YuantaP Shares and Luo Lih.
Diversification Opportunities for YuantaP Shares and Luo Lih
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between YuantaP and Luo is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding YuantaP shares Taiwan Mid Cap and Luo Lih Fen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luo Lih Fen 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 Luo Lih. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luo Lih Fen has no effect on the direction of YuantaP Shares i.e., YuantaP Shares and Luo Lih go up and down completely randomly.
Pair Corralation between YuantaP Shares and Luo Lih
If you would invest (100.00) in Luo Lih Fen on September 5, 2024 and sell it today you would earn a total of 100.00 from holding Luo Lih Fen or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 0.0% |
| Values | Daily Returns |
YuantaP shares Taiwan Mid Cap vs. Luo Lih Fen
Performance |
| Timeline |
| YuantaP shares Taiwan |
| Luo Lih Fen |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
YuantaP Shares and Luo Lih Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YuantaP Shares and Luo Lih
The main advantage of trading using opposite YuantaP Shares and Luo Lih positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YuantaP Shares position performs unexpectedly, Luo Lih 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 Luo Lih will offset losses from the drop in Luo Lih'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 |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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