Correlation Between Chia Yi and Universal Vision
Can any of the company-specific risk be diversified away by investing in both Chia Yi and Universal Vision 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 Yi and Universal Vision into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chia Yi Steel and Universal Vision Biotechnology, you can compare the effects of market volatilities on Chia Yi and Universal Vision 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 Yi with a short position of Universal Vision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chia Yi and Universal Vision.
Diversification Opportunities for Chia Yi and Universal Vision
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Chia and Universal is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Chia Yi Steel and Universal Vision Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Vision Bio and Chia Yi 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 Yi Steel are associated (or correlated) with Universal Vision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Vision Bio has no effect on the direction of Chia Yi i.e., Chia Yi and Universal Vision go up and down completely randomly.
Pair Corralation between Chia Yi and Universal Vision
Assuming the 90 days trading horizon Chia Yi Steel is expected to generate 1.38 times more return on investment than Universal Vision. However, Chia Yi is 1.38 times more volatile than Universal Vision Biotechnology. It trades about -0.02 of its potential returns per unit of risk. Universal Vision Biotechnology is currently generating about -0.05 per unit of risk. If you would invest 1,310 in Chia Yi Steel on August 27, 2024 and sell it today you would lose (215.00) from holding Chia Yi Steel or give up 16.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.59% |
| Values | Daily Returns |
Chia Yi Steel vs. Universal Vision Biotechnology
Performance |
| Timeline |
| Chia Yi Steel |
| Universal Vision Bio |
Chia Yi and Universal Vision Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chia Yi and Universal Vision
The main advantage of trading using opposite Chia Yi and Universal Vision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chia Yi position performs unexpectedly, Universal Vision 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 Universal Vision will offset losses from the drop in Universal Vision's long position.| Chia Yi vs. International CSRC Investment | Chia Yi vs. Simplo Technology Co | Chia Yi vs. Gigastorage Corp | Chia Yi vs. Yuan High Tech Development |
| Universal Vision vs. Feng Ching Metal | Universal Vision vs. Shin Kong Financial | Universal Vision vs. Shanghai Commercial Savings | Universal Vision vs. Tai Tung Communication |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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