Correlation Between Fubon MSCI and Excelliance MOS
Can any of the company-specific risk be diversified away by investing in both Fubon MSCI and Excelliance MOS 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 Excelliance MOS 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 Excelliance MOS, you can compare the effects of market volatilities on Fubon MSCI and Excelliance MOS 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 Excelliance MOS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fubon MSCI and Excelliance MOS.
Diversification Opportunities for Fubon MSCI and Excelliance MOS
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fubon and Excelliance is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Fubon MSCI Taiwan and Excelliance MOS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Excelliance MOS 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 Excelliance MOS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Excelliance MOS has no effect on the direction of Fubon MSCI i.e., Fubon MSCI and Excelliance MOS go up and down completely randomly.
Pair Corralation between Fubon MSCI and Excelliance MOS
Assuming the 90 days trading horizon Fubon MSCI Taiwan is expected to generate 0.89 times more return on investment than Excelliance MOS. However, Fubon MSCI Taiwan is 1.13 times less risky than Excelliance MOS. It trades about -0.06 of its potential returns per unit of risk. Excelliance MOS is currently generating about -0.28 per unit of risk. If you would invest 13,975 in Fubon MSCI Taiwan on September 2, 2024 and sell it today you would lose (210.00) from holding Fubon MSCI Taiwan or give up 1.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fubon MSCI Taiwan vs. Excelliance MOS
Performance |
| Timeline |
| Fubon MSCI Taiwan |
| Excelliance MOS |
Fubon MSCI and Excelliance MOS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fubon MSCI and Excelliance MOS
The main advantage of trading using opposite Fubon MSCI and Excelliance MOS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fubon MSCI position performs unexpectedly, Excelliance MOS 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 Excelliance MOS will offset losses from the drop in Excelliance MOS's long position.| Fubon MSCI vs. Yuanta Daily Taiwan | Fubon MSCI vs. Yuanta Daily CSI | Fubon MSCI vs. Fubon FTSE Vietnam | Fubon MSCI vs. Paradigm SP GSCI |
| Excelliance MOS vs. Sinopower Semiconductor | Excelliance MOS vs. Niko Semiconductor Co | Excelliance MOS vs. Advanced Power Electronics | Excelliance MOS vs. Anpec Electronics |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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