Correlation Between Uni President and Kinko Optical
Can any of the company-specific risk be diversified away by investing in both Uni President and Kinko Optical 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 Kinko Optical 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 Kinko Optical Co, you can compare the effects of market volatilities on Uni President and Kinko Optical 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 Kinko Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uni President and Kinko Optical.
Diversification Opportunities for Uni President and Kinko Optical
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Uni and Kinko is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Uni President Enterprises Corp and Kinko Optical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinko Optical 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 Kinko Optical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinko Optical has no effect on the direction of Uni President i.e., Uni President and Kinko Optical go up and down completely randomly.
Pair Corralation between Uni President and Kinko Optical
Assuming the 90 days trading horizon Uni President Enterprises Corp is expected to under-perform the Kinko Optical. But the stock apears to be less risky and, when comparing its historical volatility, Uni President Enterprises Corp is 1.16 times less risky than Kinko Optical. The stock trades about -0.03 of its potential returns per unit of risk. The Kinko Optical Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 2,520 in Kinko Optical Co on September 12, 2024 and sell it today you would earn a total of 15.00 from holding Kinko Optical Co or generate 0.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Uni President Enterprises Corp vs. Kinko Optical Co
Performance |
| Timeline |
| Uni President Enterp |
| Kinko Optical |
Uni President and Kinko Optical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Uni President and Kinko Optical
The main advantage of trading using opposite Uni President and Kinko Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uni President position performs unexpectedly, Kinko Optical 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 Kinko Optical will offset losses from the drop in Kinko Optical's 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 |
| Kinko Optical vs. AU Optronics | Kinko Optical vs. Innolux Corp | Kinko Optical vs. Ruentex Development Co | Kinko Optical 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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