Correlation Between Fubon NIFTY and YuantaP Shares
Can any of the company-specific risk be diversified away by investing in both Fubon NIFTY and YuantaP Shares 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 NIFTY and YuantaP Shares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fubon NIFTY and YuantaP shares Taiwan Top, you can compare the effects of market volatilities on Fubon NIFTY and YuantaP Shares 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 NIFTY with a short position of YuantaP Shares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fubon NIFTY and YuantaP Shares.
Diversification Opportunities for Fubon NIFTY and YuantaP Shares
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fubon and YuantaP is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Fubon NIFTY and YuantaP shares Taiwan Top in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YuantaP shares Taiwan and Fubon NIFTY 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 NIFTY are associated (or correlated) with YuantaP Shares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YuantaP shares Taiwan has no effect on the direction of Fubon NIFTY i.e., Fubon NIFTY and YuantaP Shares go up and down completely randomly.
Pair Corralation between Fubon NIFTY and YuantaP Shares
Assuming the 90 days trading horizon Fubon NIFTY is expected to under-perform the YuantaP Shares. But the etf apears to be less risky and, when comparing its historical volatility, Fubon NIFTY is 1.55 times less risky than YuantaP Shares. The etf trades about -0.05 of its potential returns per unit of risk. The YuantaP shares Taiwan Top is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 18,300 in YuantaP shares Taiwan Top on August 28, 2024 and sell it today you would earn a total of 935.00 from holding YuantaP shares Taiwan Top or generate 5.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Fubon NIFTY vs. YuantaP shares Taiwan Top
Performance |
| Timeline |
| Fubon NIFTY |
| YuantaP shares Taiwan |
Fubon NIFTY and YuantaP Shares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fubon NIFTY and YuantaP Shares
The main advantage of trading using opposite Fubon NIFTY and YuantaP Shares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fubon NIFTY position performs unexpectedly, YuantaP Shares 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 YuantaP Shares will offset losses from the drop in YuantaP Shares' long position.| Fubon NIFTY vs. Fubon Hang Seng | Fubon NIFTY vs. Fubon SP Preferred | Fubon NIFTY vs. Fubon NASDAQ 100 1X | Fubon NIFTY vs. Fubon TWSE Corporate |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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