Correlation Between CTBC 15 and Cathay Taiwan
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By analyzing existing cross correlation between CTBC 15 Developed and Cathay Taiwan 5G, you can compare the effects of market volatilities on CTBC 15 and Cathay Taiwan 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 CTBC 15 with a short position of Cathay Taiwan. Check out your portfolio center. Please also check ongoing floating volatility patterns of CTBC 15 and Cathay Taiwan.
Diversification Opportunities for CTBC 15 and Cathay Taiwan
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CTBC and Cathay is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding CTBC 15 Developed and Cathay Taiwan 5G in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cathay Taiwan 5G and CTBC 15 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 CTBC 15 Developed are associated (or correlated) with Cathay Taiwan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cathay Taiwan 5G has no effect on the direction of CTBC 15 i.e., CTBC 15 and Cathay Taiwan go up and down completely randomly.
Pair Corralation between CTBC 15 and Cathay Taiwan
Assuming the 90 days trading horizon CTBC 15 Developed is expected to generate 0.5 times more return on investment than Cathay Taiwan. However, CTBC 15 Developed is 2.01 times less risky than Cathay Taiwan. It trades about 0.41 of its potential returns per unit of risk. Cathay Taiwan 5G is currently generating about -0.1 per unit of risk. If you would invest 3,215 in CTBC 15 Developed on September 4, 2024 and sell it today you would earn a total of 181.00 from holding CTBC 15 Developed or generate 5.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CTBC 15 Developed vs. Cathay Taiwan 5G
Performance |
| Timeline |
| CTBC 15 Developed |
| Cathay Taiwan 5G |
CTBC 15 and Cathay Taiwan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CTBC 15 and Cathay Taiwan
The main advantage of trading using opposite CTBC 15 and Cathay Taiwan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CTBC 15 position performs unexpectedly, Cathay Taiwan 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 Cathay Taiwan will offset losses from the drop in Cathay Taiwan's long position.| CTBC 15 vs. Cathay Taiwan 5G | CTBC 15 vs. Ruentex Development Co | CTBC 15 vs. Symtek Automation Asia | CTBC 15 vs. CTCI Corp |
| Cathay Taiwan vs. Ruentex Development Co | Cathay Taiwan vs. Symtek Automation Asia | Cathay Taiwan vs. CTCI Corp | Cathay Taiwan vs. Information Technology Total |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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