Correlation Between Uni President and Tehmag Foods
Can any of the company-specific risk be diversified away by investing in both Uni President and Tehmag Foods 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 Uni President and Tehmag Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uni President Enterprises Corp and Tehmag Foods, you can compare the effects of market volatilities on Uni President and Tehmag Foods 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 Uni President with a short position of Tehmag Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uni President and Tehmag Foods.
Diversification Opportunities for Uni President and Tehmag Foods
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Uni and Tehmag is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Uni President Enterprises Corp and Tehmag Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tehmag Foods and Uni President 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 Uni President Enterprises Corp are associated (or correlated) with Tehmag Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tehmag Foods has no effect on the direction of Uni President i.e., Uni President and Tehmag Foods go up and down completely randomly.
Pair Corralation between Uni President and Tehmag Foods
Assuming the 90 days trading horizon Uni President Enterprises Corp is expected to under-perform the Tehmag Foods. In addition to that, Uni President is 2.04 times more volatile than Tehmag Foods. It trades about -0.24 of its total potential returns per unit of risk. Tehmag Foods is currently generating about 0.2 per unit of volatility. If you would invest 31,250 in Tehmag Foods on October 29, 2024 and sell it today you would earn a total of 550.00 from holding Tehmag Foods or generate 1.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Uni President Enterprises Corp vs. Tehmag Foods
Performance |
| Timeline |
| Uni President Enterp |
| Tehmag Foods |
Uni President and Tehmag Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Uni President and Tehmag Foods
The main advantage of trading using opposite Uni President and Tehmag Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uni President position performs unexpectedly, Tehmag Foods 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 Tehmag Foods will offset losses from the drop in Tehmag Foods' long position.| Uni President vs. President Chain Store | Uni President vs. Formosa Plastics Corp | Uni President vs. Nan Ya Plastics | Uni President vs. Taiwan Cement Corp |
| Tehmag Foods vs. Asia Metal Industries | Tehmag Foods vs. Microelectronics Technology | Tehmag Foods vs. Amulaire Thermal Technology | Tehmag Foods vs. Camellia Metal 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |