Correlation Between De Licacy and Leatec Fine
Can any of the company-specific risk be diversified away by investing in both De Licacy and Leatec Fine 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 De Licacy and Leatec Fine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between De Licacy Industrial and Leatec Fine Ceramics, you can compare the effects of market volatilities on De Licacy and Leatec Fine 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 De Licacy with a short position of Leatec Fine. Check out your portfolio center. Please also check ongoing floating volatility patterns of De Licacy and Leatec Fine.
Diversification Opportunities for De Licacy and Leatec Fine
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 1464 and Leatec is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding De Licacy Industrial and Leatec Fine Ceramics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leatec Fine Ceramics and De Licacy 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 De Licacy Industrial are associated (or correlated) with Leatec Fine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leatec Fine Ceramics has no effect on the direction of De Licacy i.e., De Licacy and Leatec Fine go up and down completely randomly.
Pair Corralation between De Licacy and Leatec Fine
Assuming the 90 days trading horizon De Licacy Industrial is expected to under-perform the Leatec Fine. In addition to that, De Licacy is 1.27 times more volatile than Leatec Fine Ceramics. It trades about -0.05 of its total potential returns per unit of risk. Leatec Fine Ceramics is currently generating about -0.05 per unit of volatility. If you would invest 2,975 in Leatec Fine Ceramics on August 27, 2024 and sell it today you would lose (85.00) from holding Leatec Fine Ceramics or give up 2.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
De Licacy Industrial vs. Leatec Fine Ceramics
Performance |
| Timeline |
| De Licacy Industrial |
| Leatec Fine Ceramics |
De Licacy and Leatec Fine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with De Licacy and Leatec Fine
The main advantage of trading using opposite De Licacy and Leatec Fine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if De Licacy position performs unexpectedly, Leatec Fine 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 Leatec Fine will offset losses from the drop in Leatec Fine's long position.| De Licacy vs. Taiwan Semiconductor Manufacturing | De Licacy vs. Hon Hai Precision | De Licacy vs. MediaTek | De Licacy vs. Chunghwa Telecom Co |
| Leatec Fine vs. Chiu Ting Machinery | Leatec Fine vs. Great Computer | Leatec Fine vs. Ruentex Engineering Construction | Leatec Fine vs. Sesoda 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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