Correlation Between United Microelectronics and Getac Technology
Can any of the company-specific risk be diversified away by investing in both United Microelectronics and Getac Technology 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 United Microelectronics and Getac Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Microelectronics and Getac Technology Corp, you can compare the effects of market volatilities on United Microelectronics and Getac Technology 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 United Microelectronics with a short position of Getac Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Microelectronics and Getac Technology.
Diversification Opportunities for United Microelectronics and Getac Technology
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between United and Getac is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding United Microelectronics and Getac Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Getac Technology Corp and United Microelectronics 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 United Microelectronics are associated (or correlated) with Getac Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Getac Technology Corp has no effect on the direction of United Microelectronics i.e., United Microelectronics and Getac Technology go up and down completely randomly.
Pair Corralation between United Microelectronics and Getac Technology
Assuming the 90 days trading horizon United Microelectronics is expected to under-perform the Getac Technology. But the stock apears to be less risky and, when comparing its historical volatility, United Microelectronics is 1.6 times less risky than Getac Technology. The stock trades about -0.32 of its potential returns per unit of risk. The Getac Technology Corp is currently generating about -0.15 of returns per unit of risk over similar time horizon. If you would invest 11,150 in Getac Technology Corp on August 31, 2024 and sell it today you would lose (800.00) from holding Getac Technology Corp or give up 7.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Microelectronics vs. Getac Technology Corp
Performance |
| Timeline |
| United Microelectronics |
| Getac Technology Corp |
United Microelectronics and Getac Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Microelectronics and Getac Technology
The main advantage of trading using opposite United Microelectronics and Getac Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Microelectronics position performs unexpectedly, Getac Technology 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 Getac Technology will offset losses from the drop in Getac Technology's long position.| United Microelectronics vs. AU Optronics | United Microelectronics vs. Macronix International Co | United Microelectronics vs. Winbond Electronics Corp | United Microelectronics vs. Hon Hai Precision |
| Getac Technology vs. United Microelectronics | Getac Technology vs. Winbond Electronics Corp | Getac Technology vs. Macronix International Co |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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