Correlation Between YuantaP Shares and Grand Plastic
Can any of the company-specific risk be diversified away by investing in both YuantaP Shares and Grand Plastic 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 Grand Plastic 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 Grand Plastic Technology, you can compare the effects of market volatilities on YuantaP Shares and Grand Plastic 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 Grand Plastic. Check out your portfolio center. Please also check ongoing floating volatility patterns of YuantaP Shares and Grand Plastic.
Diversification Opportunities for YuantaP Shares and Grand Plastic
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between YuantaP and Grand is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding YuantaP shares Taiwan Electron and Grand Plastic Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grand Plastic 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 Electronics are associated (or correlated) with Grand Plastic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grand Plastic Technology has no effect on the direction of YuantaP Shares i.e., YuantaP Shares and Grand Plastic go up and down completely randomly.
Pair Corralation between YuantaP Shares and Grand Plastic
Assuming the 90 days trading horizon YuantaP Shares is expected to generate 3.69 times less return on investment than Grand Plastic. But when comparing it to its historical volatility, YuantaP shares Taiwan Electronics is 2.75 times less risky than Grand Plastic. It trades about 0.09 of its potential returns per unit of risk. Grand Plastic Technology is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 22,839 in Grand Plastic Technology on August 30, 2024 and sell it today you would earn a total of 141,661 from holding Grand Plastic Technology or generate 620.26% 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. Grand Plastic Technology
Performance |
| Timeline |
| YuantaP shares Taiwan |
| Grand Plastic Technology |
YuantaP Shares and Grand Plastic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YuantaP Shares and Grand Plastic
The main advantage of trading using opposite YuantaP Shares and Grand Plastic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YuantaP Shares position performs unexpectedly, Grand Plastic 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 Grand Plastic will offset losses from the drop in Grand Plastic's long position.| YuantaP Shares vs. Yuanta Daily Taiwan | YuantaP Shares vs. Symtek Automation Asia | YuantaP Shares vs. CTCI Corp | YuantaP Shares vs. Information Technology Total |
| Grand Plastic vs. Powertech Technology | Grand Plastic vs. Formosa Sumco Technology | Grand Plastic vs. Radiant Opto Electronics Corp | Grand Plastic vs. Faraday Technology 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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