Correlation Between Walsin Lihwa and Ta Ya
Can any of the company-specific risk be diversified away by investing in both Walsin Lihwa and Ta Ya 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 Walsin Lihwa and Ta Ya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walsin Lihwa Corp and Ta Ya Electric, you can compare the effects of market volatilities on Walsin Lihwa and Ta Ya 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 Walsin Lihwa with a short position of Ta Ya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walsin Lihwa and Ta Ya.
Diversification Opportunities for Walsin Lihwa and Ta Ya
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Walsin and 1609 is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Walsin Lihwa Corp and Ta Ya Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ta Ya Electric and Walsin Lihwa 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 Walsin Lihwa Corp are associated (or correlated) with Ta Ya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ta Ya Electric has no effect on the direction of Walsin Lihwa i.e., Walsin Lihwa and Ta Ya go up and down completely randomly.
Pair Corralation between Walsin Lihwa and Ta Ya
Assuming the 90 days trading horizon Walsin Lihwa Corp is expected to under-perform the Ta Ya. In addition to that, Walsin Lihwa is 1.33 times more volatile than Ta Ya Electric. It trades about -0.23 of its total potential returns per unit of risk. Ta Ya Electric is currently generating about 0.0 per unit of volatility. If you would invest 4,610 in Ta Ya Electric on August 29, 2024 and sell it today you would lose (10.00) from holding Ta Ya Electric or give up 0.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walsin Lihwa Corp vs. Ta Ya Electric
Performance |
| Timeline |
| Walsin Lihwa Corp |
| Ta Ya Electric |
Walsin Lihwa and Ta Ya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walsin Lihwa and Ta Ya
The main advantage of trading using opposite Walsin Lihwa and Ta Ya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walsin Lihwa position performs unexpectedly, Ta Ya 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 Ya will offset losses from the drop in Ta Ya's long position.| Walsin Lihwa vs. Yulon Motor Co | Walsin Lihwa vs. Far Eastern Department | Walsin Lihwa vs. China Steel Corp | Walsin Lihwa vs. Chang Hwa Commercial |
| Ta Ya vs. Yulon Motor Co | Ta Ya vs. Far Eastern Department | Ta Ya vs. China Steel Corp | Ta Ya vs. Chang Hwa Commercial |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |