Correlation Between Compeq Manufacturing and Nan Ya
Can any of the company-specific risk be diversified away by investing in both Compeq Manufacturing and Nan 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 Compeq Manufacturing and Nan Ya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Compeq Manufacturing Co and Nan Ya Printed, you can compare the effects of market volatilities on Compeq Manufacturing and Nan 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 Compeq Manufacturing with a short position of Nan Ya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compeq Manufacturing and Nan Ya.
Diversification Opportunities for Compeq Manufacturing and Nan Ya
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Compeq and Nan is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Compeq Manufacturing Co and Nan Ya Printed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nan Ya Printed and Compeq Manufacturing 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 Compeq Manufacturing Co are associated (or correlated) with Nan Ya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nan Ya Printed has no effect on the direction of Compeq Manufacturing i.e., Compeq Manufacturing and Nan Ya go up and down completely randomly.
Pair Corralation between Compeq Manufacturing and Nan Ya
Assuming the 90 days trading horizon Compeq Manufacturing Co is expected to generate 0.72 times more return on investment than Nan Ya. However, Compeq Manufacturing Co is 1.4 times less risky than Nan Ya. It trades about -0.04 of its potential returns per unit of risk. Nan Ya Printed is currently generating about -0.3 per unit of risk. If you would invest 6,470 in Compeq Manufacturing Co on September 12, 2024 and sell it today you would lose (100.00) from holding Compeq Manufacturing Co or give up 1.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Compeq Manufacturing Co vs. Nan Ya Printed
Performance |
| Timeline |
| Compeq Manufacturing |
| Nan Ya Printed |
Compeq Manufacturing and Nan Ya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compeq Manufacturing and Nan Ya
The main advantage of trading using opposite Compeq Manufacturing and Nan Ya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compeq Manufacturing position performs unexpectedly, Nan 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 Nan Ya will offset losses from the drop in Nan Ya's long position.| Compeq Manufacturing vs. AU Optronics | Compeq Manufacturing vs. Innolux Corp | Compeq Manufacturing vs. Ruentex Development Co | Compeq Manufacturing vs. WiseChip Semiconductor |
| Nan Ya vs. AU Optronics | Nan Ya vs. Innolux Corp | Nan Ya vs. Ruentex Development Co | Nan Ya vs. WiseChip Semiconductor |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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