Correlation Between YuantaP Shares and AAEON Technology
Can any of the company-specific risk be diversified away by investing in both YuantaP Shares and AAEON Technology 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 AAEON Technology 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 AAEON Technology, you can compare the effects of market volatilities on YuantaP Shares and AAEON Technology 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 AAEON Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of YuantaP Shares and AAEON Technology.
Diversification Opportunities for YuantaP Shares and AAEON Technology
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between YuantaP and AAEON is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding YuantaP shares Taiwan Electron and AAEON Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AAEON 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 AAEON Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AAEON Technology has no effect on the direction of YuantaP Shares i.e., YuantaP Shares and AAEON Technology go up and down completely randomly.
Pair Corralation between YuantaP Shares and AAEON Technology
Assuming the 90 days trading horizon YuantaP shares Taiwan Electronics is expected to generate 0.64 times more return on investment than AAEON Technology. However, YuantaP shares Taiwan Electronics is 1.57 times less risky than AAEON Technology. It trades about -0.19 of its potential returns per unit of risk. AAEON Technology is currently generating about -0.14 per unit of risk. If you would invest 10,285 in YuantaP shares Taiwan Electronics on August 30, 2024 and sell it today you would lose (505.00) from holding YuantaP shares Taiwan Electronics or give up 4.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
YuantaP shares Taiwan Electron vs. AAEON Technology
Performance |
| Timeline |
| YuantaP shares Taiwan |
| AAEON Technology |
YuantaP Shares and AAEON Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YuantaP Shares and AAEON Technology
The main advantage of trading using opposite YuantaP Shares and AAEON Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YuantaP Shares position performs unexpectedly, AAEON Technology 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 AAEON Technology will offset losses from the drop in AAEON Technology's long position.| YuantaP Shares vs. Symtek Automation Asia | YuantaP Shares vs. CTCI Corp | YuantaP Shares vs. Information Technology Total | YuantaP Shares vs. Kinko Optical Co |
| AAEON Technology vs. Qisda Corp | AAEON Technology vs. Quanta Computer | AAEON Technology vs. Coretronic | AAEON Technology vs. Wistron 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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