Correlation Between Fubon MSCI and Coretronic
Can any of the company-specific risk be diversified away by investing in both Fubon MSCI and Coretronic 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 Coretronic 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 Coretronic, you can compare the effects of market volatilities on Fubon MSCI and Coretronic 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 Coretronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fubon MSCI and Coretronic.
Diversification Opportunities for Fubon MSCI and Coretronic
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fubon and Coretronic is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Fubon MSCI Taiwan and Coretronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coretronic 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 Coretronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coretronic has no effect on the direction of Fubon MSCI i.e., Fubon MSCI and Coretronic go up and down completely randomly.
Pair Corralation between Fubon MSCI and Coretronic
Assuming the 90 days trading horizon Fubon MSCI Taiwan is expected to generate 0.54 times more return on investment than Coretronic. However, Fubon MSCI Taiwan is 1.86 times less risky than Coretronic. It trades about 0.09 of its potential returns per unit of risk. Coretronic is currently generating about 0.04 per unit of risk. If you would invest 8,370 in Fubon MSCI Taiwan on August 26, 2024 and sell it today you would earn a total of 5,805 from holding Fubon MSCI Taiwan or generate 69.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fubon MSCI Taiwan vs. Coretronic
Performance |
| Timeline |
| Fubon MSCI Taiwan |
| Coretronic |
Fubon MSCI and Coretronic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fubon MSCI and Coretronic
The main advantage of trading using opposite Fubon MSCI and Coretronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fubon MSCI position performs unexpectedly, Coretronic 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 Coretronic will offset losses from the drop in Coretronic's long position.| Fubon MSCI vs. Fubon Hang Seng | Fubon MSCI vs. Fubon SP Preferred | Fubon MSCI vs. Fubon NASDAQ 100 1X | Fubon MSCI vs. Fubon TWSE Corporate |
| Coretronic vs. Merry Electronics Co | Coretronic vs. Sampo Corp | Coretronic vs. Taiwan Sanyo Electric | Coretronic vs. E Lead Electronic 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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