Correlation Between Fubon MSCI and Globe Union
Can any of the company-specific risk be diversified away by investing in both Fubon MSCI and Globe Union 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 Globe Union 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 Globe Union Industrial, you can compare the effects of market volatilities on Fubon MSCI and Globe Union 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 Globe Union. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fubon MSCI and Globe Union.
Diversification Opportunities for Fubon MSCI and Globe Union
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fubon and Globe is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Fubon MSCI Taiwan and Globe Union Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globe Union Industrial 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 Globe Union. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globe Union Industrial has no effect on the direction of Fubon MSCI i.e., Fubon MSCI and Globe Union go up and down completely randomly.
Pair Corralation between Fubon MSCI and Globe Union
Assuming the 90 days trading horizon Fubon MSCI Taiwan is expected to generate 0.83 times more return on investment than Globe Union. However, Fubon MSCI Taiwan is 1.21 times less risky than Globe Union. It trades about 0.07 of its potential returns per unit of risk. Globe Union Industrial is currently generating about -0.07 per unit of risk. If you would invest 11,785 in Fubon MSCI Taiwan on September 3, 2024 and sell it today you would earn a total of 1,980 from holding Fubon MSCI Taiwan or generate 16.8% 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. Globe Union Industrial
Performance |
| Timeline |
| Fubon MSCI Taiwan |
| Globe Union Industrial |
Fubon MSCI and Globe Union Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fubon MSCI and Globe Union
The main advantage of trading using opposite Fubon MSCI and Globe Union positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fubon MSCI position performs unexpectedly, Globe Union 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 Globe Union will offset losses from the drop in Globe Union's long position.| Fubon MSCI vs. Cathay Taiwan 5G | Fubon MSCI vs. Ruentex Development Co | Fubon MSCI vs. Symtek Automation Asia | Fubon MSCI vs. CTCI Corp |
| Globe Union vs. Universal Microelectronics Co | Globe Union vs. AVerMedia Technologies | Globe Union vs. Symtek Automation Asia | Globe Union vs. WiseChip Semiconductor |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |