Correlation Between Feng Hsin and Holtek Semiconductor
Can any of the company-specific risk be diversified away by investing in both Feng Hsin and Holtek Semiconductor 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 Feng Hsin and Holtek Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Feng Hsin Steel and Holtek Semiconductor, you can compare the effects of market volatilities on Feng Hsin and Holtek Semiconductor 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 Feng Hsin with a short position of Holtek Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Feng Hsin and Holtek Semiconductor.
Diversification Opportunities for Feng Hsin and Holtek Semiconductor
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Feng and Holtek is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Feng Hsin Steel and Holtek Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holtek Semiconductor and Feng Hsin 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 Feng Hsin Steel are associated (or correlated) with Holtek Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holtek Semiconductor has no effect on the direction of Feng Hsin i.e., Feng Hsin and Holtek Semiconductor go up and down completely randomly.
Pair Corralation between Feng Hsin and Holtek Semiconductor
Assuming the 90 days trading horizon Feng Hsin Steel is expected to generate 0.64 times more return on investment than Holtek Semiconductor. However, Feng Hsin Steel is 1.55 times less risky than Holtek Semiconductor. It trades about 0.03 of its potential returns per unit of risk. Holtek Semiconductor is currently generating about -0.02 per unit of risk. If you would invest 6,530 in Feng Hsin Steel on September 14, 2024 and sell it today you would earn a total of 940.00 from holding Feng Hsin Steel or generate 14.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Feng Hsin Steel vs. Holtek Semiconductor
Performance |
| Timeline |
| Feng Hsin Steel |
| Holtek Semiconductor |
Feng Hsin and Holtek Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Feng Hsin and Holtek Semiconductor
The main advantage of trading using opposite Feng Hsin and Holtek Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Feng Hsin position performs unexpectedly, Holtek Semiconductor 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 Holtek Semiconductor will offset losses from the drop in Holtek Semiconductor's long position.| Feng Hsin vs. Tung Ho Steel | Feng Hsin vs. U Ming Marine Transport | Feng Hsin vs. TSRC Corp | Feng Hsin vs. Cheng Shin Rubber |
| Holtek Semiconductor vs. Novatek Microelectronics Corp | Holtek Semiconductor vs. Realtek Semiconductor Corp | Holtek Semiconductor vs. Nuvoton Technology Corp | Holtek Semiconductor vs. Global Unichip 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| CEOs Directory Screen CEOs from public companies around the world |