Correlation Between YuantaP Shares and Chiu Ting
Can any of the company-specific risk be diversified away by investing in both YuantaP Shares and Chiu Ting 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 Chiu Ting into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YuantaP shares Taiwan Electronics and Chiu Ting Machinery, you can compare the effects of market volatilities on YuantaP Shares and Chiu Ting 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 Chiu Ting. Check out your portfolio center. Please also check ongoing floating volatility patterns of YuantaP Shares and Chiu Ting.
Diversification Opportunities for YuantaP Shares and Chiu Ting
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between YuantaP and Chiu is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding YuantaP shares Taiwan Electron and Chiu Ting Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chiu Ting Machinery 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 Electronics are associated (or correlated) with Chiu Ting. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chiu Ting Machinery has no effect on the direction of YuantaP Shares i.e., YuantaP Shares and Chiu Ting go up and down completely randomly.
Pair Corralation between YuantaP Shares and Chiu Ting
Assuming the 90 days trading horizon YuantaP shares Taiwan Electronics is expected to generate 0.69 times more return on investment than Chiu Ting. However, YuantaP shares Taiwan Electronics is 1.46 times less risky than Chiu Ting. It trades about 0.1 of its potential returns per unit of risk. Chiu Ting Machinery is currently generating about 0.01 per unit of risk. If you would invest 6,870 in YuantaP shares Taiwan Electronics on September 2, 2024 and sell it today you would earn a total of 2,960 from holding YuantaP shares Taiwan Electronics or generate 43.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
YuantaP shares Taiwan Electron vs. Chiu Ting Machinery
Performance |
| Timeline |
| YuantaP shares Taiwan |
| Chiu Ting Machinery |
YuantaP Shares and Chiu Ting Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YuantaP Shares and Chiu Ting
The main advantage of trading using opposite YuantaP Shares and Chiu Ting positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YuantaP Shares position performs unexpectedly, Chiu Ting 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 Chiu Ting will offset losses from the drop in Chiu Ting's long position.| YuantaP Shares vs. Yuanta Daily CSI | YuantaP Shares vs. Fubon FTSE Vietnam | YuantaP Shares vs. Paradigm SP GSCI |
| Chiu Ting vs. BES Engineering Co | Chiu Ting vs. Continental Holdings Corp | Chiu Ting vs. Kee Tai Properties | Chiu Ting vs. Hung Sheng Construction |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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