Correlation Between Fubon MSCI and Airtac International
Can any of the company-specific risk be diversified away by investing in both Fubon MSCI and Airtac International 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 Fubon MSCI and Airtac International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fubon MSCI Taiwan and Airtac International Group, you can compare the effects of market volatilities on Fubon MSCI and Airtac International 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 Fubon MSCI with a short position of Airtac International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fubon MSCI and Airtac International.
Diversification Opportunities for Fubon MSCI and Airtac International
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fubon and Airtac is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Fubon MSCI Taiwan and Airtac International Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airtac International and Fubon MSCI 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 Fubon MSCI Taiwan are associated (or correlated) with Airtac International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airtac International has no effect on the direction of Fubon MSCI i.e., Fubon MSCI and Airtac International go up and down completely randomly.
Pair Corralation between Fubon MSCI and Airtac International
Assuming the 90 days trading horizon Fubon MSCI Taiwan is expected to generate 0.47 times more return on investment than Airtac International. However, Fubon MSCI Taiwan is 2.14 times less risky than Airtac International. It trades about 0.06 of its potential returns per unit of risk. Airtac International Group is currently generating about -0.12 per unit of risk. If you would invest 13,450 in Fubon MSCI Taiwan on August 30, 2024 and sell it today you would earn a total of 365.00 from holding Fubon MSCI Taiwan or generate 2.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fubon MSCI Taiwan vs. Airtac International Group
Performance |
| Timeline |
| Fubon MSCI Taiwan |
| Airtac International |
Fubon MSCI and Airtac International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fubon MSCI and Airtac International
The main advantage of trading using opposite Fubon MSCI and Airtac International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fubon MSCI position performs unexpectedly, Airtac International 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 Airtac International will offset losses from the drop in Airtac International's long position.| Fubon MSCI vs. Yuanta Daily Taiwan | Fubon MSCI vs. Symtek Automation Asia | Fubon MSCI vs. CTCI Corp | Fubon MSCI vs. Information Technology Total |
| Airtac International vs. Hiwin Technologies Corp | Airtac International vs. Advantech Co | Airtac International vs. Delta Electronics | Airtac International vs. Eclat Textile Co |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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