Correlation Between Nan Ya and Trade Van
Can any of the company-specific risk be diversified away by investing in both Nan Ya and Trade Van 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 Nan Ya and Trade Van into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nan Ya Plastics and Trade Van Information Services, you can compare the effects of market volatilities on Nan Ya and Trade Van 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 Nan Ya with a short position of Trade Van. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nan Ya and Trade Van.
Diversification Opportunities for Nan Ya and Trade Van
Very good diversification
The 3 months correlation between Nan and Trade is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Nan Ya Plastics and Trade Van Information Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trade Van Information and Nan Ya 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 Nan Ya Plastics are associated (or correlated) with Trade Van. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trade Van Information has no effect on the direction of Nan Ya i.e., Nan Ya and Trade Van go up and down completely randomly.
Pair Corralation between Nan Ya and Trade Van
Assuming the 90 days trading horizon Nan Ya Plastics is expected to under-perform the Trade Van. In addition to that, Nan Ya is 1.77 times more volatile than Trade Van Information Services. It trades about -0.1 of its total potential returns per unit of risk. Trade Van Information Services is currently generating about 0.18 per unit of volatility. If you would invest 7,390 in Trade Van Information Services on September 12, 2024 and sell it today you would earn a total of 820.00 from holding Trade Van Information Services or generate 11.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nan Ya Plastics vs. Trade Van Information Services
Performance |
| Timeline |
| Nan Ya Plastics |
| Trade Van Information |
Nan Ya and Trade Van Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nan Ya and Trade Van
The main advantage of trading using opposite Nan Ya and Trade Van positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nan Ya position performs unexpectedly, Trade Van 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 Trade Van will offset losses from the drop in Trade Van's long position.| Nan Ya vs. Tainan Spinning Co | Nan Ya vs. Lealea Enterprise Co | Nan Ya vs. China Petrochemical Development | Nan Ya vs. Ruentex Development Co |
| Trade Van vs. AU Optronics | Trade Van vs. Innolux Corp | Trade Van vs. Ruentex Development Co | Trade Van 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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