Correlation Between Tong Yang and Ta Yih
Can any of the company-specific risk be diversified away by investing in both Tong Yang and Ta Yih 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 Tong Yang and Ta Yih into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tong Yang Industry and Ta Yih Industrial, you can compare the effects of market volatilities on Tong Yang and Ta Yih 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 Tong Yang with a short position of Ta Yih. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tong Yang and Ta Yih.
Diversification Opportunities for Tong Yang and Ta Yih
Excellent diversification
The 3 months correlation between Tong and 1521 is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Tong Yang Industry and Ta Yih Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ta Yih Industrial and Tong Yang 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 Tong Yang Industry are associated (or correlated) with Ta Yih. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ta Yih Industrial has no effect on the direction of Tong Yang i.e., Tong Yang and Ta Yih go up and down completely randomly.
Pair Corralation between Tong Yang and Ta Yih
Assuming the 90 days trading horizon Tong Yang Industry is expected to generate 1.93 times more return on investment than Ta Yih. However, Tong Yang is 1.93 times more volatile than Ta Yih Industrial. It trades about 0.02 of its potential returns per unit of risk. Ta Yih Industrial is currently generating about -0.09 per unit of risk. If you would invest 11,500 in Tong Yang Industry on September 3, 2024 and sell it today you would earn a total of 350.00 from holding Tong Yang Industry or generate 3.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tong Yang Industry vs. Ta Yih Industrial
Performance |
| Timeline |
| Tong Yang Industry |
| Ta Yih Industrial |
Tong Yang and Ta Yih Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tong Yang and Ta Yih
The main advantage of trading using opposite Tong Yang and Ta Yih positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tong Yang position performs unexpectedly, Ta Yih 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 Ta Yih will offset losses from the drop in Ta Yih's long position.| Tong Yang vs. Tainan Spinning Co | Tong Yang vs. Chia Her Industrial | Tong Yang vs. WiseChip Semiconductor | Tong Yang vs. Novatek Microelectronics Corp |
| Ta Yih vs. TYC Brother Industrial | Ta Yih vs. Basso Industry Corp | Ta Yih vs. Hota Industrial Mfg | Ta Yih vs. Tong Yang Industry |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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