Correlation Between Fubon MSCI and Taiwan Mask
Can any of the company-specific risk be diversified away by investing in both Fubon MSCI and Taiwan Mask 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 Taiwan Mask 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 Taiwan Mask Corp, you can compare the effects of market volatilities on Fubon MSCI and Taiwan Mask 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 Taiwan Mask. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fubon MSCI and Taiwan Mask.
Diversification Opportunities for Fubon MSCI and Taiwan Mask
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Fubon and Taiwan is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Fubon MSCI Taiwan and Taiwan Mask Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taiwan Mask Corp 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 Taiwan Mask. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taiwan Mask Corp has no effect on the direction of Fubon MSCI i.e., Fubon MSCI and Taiwan Mask go up and down completely randomly.
Pair Corralation between Fubon MSCI and Taiwan Mask
Assuming the 90 days trading horizon Fubon MSCI Taiwan is expected to under-perform the Taiwan Mask. But the etf apears to be less risky and, when comparing its historical volatility, Fubon MSCI Taiwan is 1.78 times less risky than Taiwan Mask. The etf trades about -0.11 of its potential returns per unit of risk. The Taiwan Mask Corp is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 5,530 in Taiwan Mask Corp on September 1, 2024 and sell it today you would lose (170.00) from holding Taiwan Mask Corp or give up 3.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Fubon MSCI Taiwan vs. Taiwan Mask Corp
Performance |
| Timeline |
| Fubon MSCI Taiwan |
| Taiwan Mask Corp |
Fubon MSCI and Taiwan Mask Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fubon MSCI and Taiwan Mask
The main advantage of trading using opposite Fubon MSCI and Taiwan Mask positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fubon MSCI position performs unexpectedly, Taiwan Mask 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 Taiwan Mask will offset losses from the drop in Taiwan Mask's long position.| Fubon MSCI vs. Yuanta Daily Taiwan | Fubon MSCI vs. Cathay Taiwan 5G | Fubon MSCI vs. Yuanta Daily CSI | Fubon MSCI vs. Fubon FTSE Vietnam |
| Taiwan Mask vs. Macronix International Co | Taiwan Mask vs. Mosel Vitelic | Taiwan Mask vs. Winbond Electronics Corp | Taiwan Mask vs. Silicon Integrated Systems |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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