Correlation Between Chia Her and Amtran Technology
Can any of the company-specific risk be diversified away by investing in both Chia Her and Amtran Technology 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 Chia Her and Amtran Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chia Her Industrial and Amtran Technology Co, you can compare the effects of market volatilities on Chia Her and Amtran Technology 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 Chia Her with a short position of Amtran Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chia Her and Amtran Technology.
Diversification Opportunities for Chia Her and Amtran Technology
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Chia and Amtran is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Chia Her Industrial and Amtran Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amtran Technology and Chia Her 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 Chia Her Industrial are associated (or correlated) with Amtran Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amtran Technology has no effect on the direction of Chia Her i.e., Chia Her and Amtran Technology go up and down completely randomly.
Pair Corralation between Chia Her and Amtran Technology
Assuming the 90 days trading horizon Chia Her Industrial is expected to generate 3.65 times more return on investment than Amtran Technology. However, Chia Her is 3.65 times more volatile than Amtran Technology Co. It trades about 0.01 of its potential returns per unit of risk. Amtran Technology Co is currently generating about -0.19 per unit of risk. If you would invest 2,685 in Chia Her Industrial on September 12, 2024 and sell it today you would lose (60.00) from holding Chia Her Industrial or give up 2.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chia Her Industrial vs. Amtran Technology Co
Performance |
| Timeline |
| Chia Her Industrial |
| Amtran Technology |
Chia Her and Amtran Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chia Her and Amtran Technology
The main advantage of trading using opposite Chia Her and Amtran Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chia Her position performs unexpectedly, Amtran Technology 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 Amtran Technology will offset losses from the drop in Amtran Technology's long position.| Chia Her vs. Feng Tay Enterprises | Chia Her vs. Ruentex Development Co | Chia Her vs. WiseChip Semiconductor | Chia Her vs. Novatek Microelectronics Corp |
| Amtran Technology vs. Feng Tay Enterprises | Amtran Technology vs. Ruentex Development Co | Amtran Technology vs. WiseChip Semiconductor | Amtran Technology vs. Novatek Microelectronics Corp |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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