Correlation Between Yuanta Daily and Paradigm
Can any of the company-specific risk be diversified away by investing in both Yuanta Daily and Paradigm 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 Yuanta Daily and Paradigm into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yuanta Daily CSI and Paradigm SP GSCI, you can compare the effects of market volatilities on Yuanta Daily and Paradigm 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 Yuanta Daily with a short position of Paradigm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuanta Daily and Paradigm.
Diversification Opportunities for Yuanta Daily and Paradigm
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Yuanta and Paradigm is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Yuanta Daily CSI and Paradigm SP GSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Paradigm SP GSCI and Yuanta Daily 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 Yuanta Daily CSI are associated (or correlated) with Paradigm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Paradigm SP GSCI has no effect on the direction of Yuanta Daily i.e., Yuanta Daily and Paradigm go up and down completely randomly.
Pair Corralation between Yuanta Daily and Paradigm
Assuming the 90 days trading horizon Yuanta Daily CSI is expected to under-perform the Paradigm. But the etf apears to be less risky and, when comparing its historical volatility, Yuanta Daily CSI is 1.18 times less risky than Paradigm. The etf trades about -0.08 of its potential returns per unit of risk. The Paradigm SP GSCI is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,229 in Paradigm SP GSCI on August 30, 2024 and sell it today you would earn a total of 57.00 from holding Paradigm SP GSCI or generate 4.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yuanta Daily CSI vs. Paradigm SP GSCI
Performance |
| Timeline |
| Yuanta Daily CSI |
| Paradigm SP GSCI |
Yuanta Daily and Paradigm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yuanta Daily and Paradigm
The main advantage of trading using opposite Yuanta Daily and Paradigm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuanta Daily position performs unexpectedly, Paradigm 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 Paradigm will offset losses from the drop in Paradigm's long position.| Yuanta Daily vs. Symtek Automation Asia | Yuanta Daily vs. CTCI Corp | Yuanta Daily vs. Information Technology Total | Yuanta Daily vs. Kinko Optical Co |
| Paradigm vs. Paradigm SP GSCI | Paradigm vs. CTBC USD Corporate | Paradigm vs. Cathay TIP TAIEX | Paradigm vs. Yuanta Daily SP |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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