Correlation Between Taiwan Sanyo and Chicony Power
Can any of the company-specific risk be diversified away by investing in both Taiwan Sanyo and Chicony Power 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 Taiwan Sanyo and Chicony Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Taiwan Sanyo Electric and Chicony Power Technology, you can compare the effects of market volatilities on Taiwan Sanyo and Chicony Power 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 Taiwan Sanyo with a short position of Chicony Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taiwan Sanyo and Chicony Power.
Diversification Opportunities for Taiwan Sanyo and Chicony Power
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Taiwan and Chicony is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Taiwan Sanyo Electric and Chicony Power Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chicony Power Technology and Taiwan Sanyo 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 Taiwan Sanyo Electric are associated (or correlated) with Chicony Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chicony Power Technology has no effect on the direction of Taiwan Sanyo i.e., Taiwan Sanyo and Chicony Power go up and down completely randomly.
Pair Corralation between Taiwan Sanyo and Chicony Power
Assuming the 90 days trading horizon Taiwan Sanyo Electric is expected to generate 0.49 times more return on investment than Chicony Power. However, Taiwan Sanyo Electric is 2.05 times less risky than Chicony Power. It trades about -0.1 of its potential returns per unit of risk. Chicony Power Technology is currently generating about -0.06 per unit of risk. If you would invest 4,510 in Taiwan Sanyo Electric on August 29, 2024 and sell it today you would lose (580.00) from holding Taiwan Sanyo Electric or give up 12.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Taiwan Sanyo Electric vs. Chicony Power Technology
Performance |
| Timeline |
| Taiwan Sanyo Electric |
| Chicony Power Technology |
Taiwan Sanyo and Chicony Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Taiwan Sanyo and Chicony Power
The main advantage of trading using opposite Taiwan Sanyo and Chicony Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taiwan Sanyo position performs unexpectedly, Chicony Power 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 Chicony Power will offset losses from the drop in Chicony Power's long position.| Taiwan Sanyo vs. Sampo Corp | Taiwan Sanyo vs. China Electric Manufacturing | Taiwan Sanyo vs. Walsin Lihwa Corp | Taiwan Sanyo vs. Ta Ya Electric |
| Chicony Power vs. Merry Electronics Co | Chicony Power vs. E Lead Electronic Co | Chicony Power vs. Heran Co | Chicony Power vs. Zeng Hsing Industrial |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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