Correlation Between Yageo Corp and Accton Technology
Can any of the company-specific risk be diversified away by investing in both Yageo Corp and Accton 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 Yageo Corp and Accton Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yageo Corp and Accton Technology Corp, you can compare the effects of market volatilities on Yageo Corp and Accton 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 Yageo Corp with a short position of Accton Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yageo Corp and Accton Technology.
Diversification Opportunities for Yageo Corp and Accton Technology
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Yageo and Accton is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Yageo Corp and Accton Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accton Technology Corp and Yageo Corp 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 Yageo Corp are associated (or correlated) with Accton Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accton Technology Corp has no effect on the direction of Yageo Corp i.e., Yageo Corp and Accton Technology go up and down completely randomly.
Pair Corralation between Yageo Corp and Accton Technology
Assuming the 90 days trading horizon Yageo Corp is expected to under-perform the Accton Technology. But the stock apears to be less risky and, when comparing its historical volatility, Yageo Corp is 1.29 times less risky than Accton Technology. The stock trades about -0.31 of its potential returns per unit of risk. The Accton Technology Corp is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 57,300 in Accton Technology Corp on August 27, 2024 and sell it today you would earn a total of 6,700 from holding Accton Technology Corp or generate 11.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yageo Corp vs. Accton Technology Corp
Performance |
| Timeline |
| Yageo Corp |
| Accton Technology Corp |
Yageo Corp and Accton Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yageo Corp and Accton Technology
The main advantage of trading using opposite Yageo Corp and Accton Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yageo Corp position performs unexpectedly, Accton 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 Accton Technology will offset losses from the drop in Accton Technology's long position.| Yageo Corp vs. Pili International Multimedia | Yageo Corp vs. AVerMedia Technologies | Yageo Corp vs. EnTie Commercial Bank | Yageo Corp vs. CHINA DEVELOPMENT FINANCIAL |
| Accton Technology vs. Novatek Microelectronics Corp | Accton Technology vs. Quanta Computer | Accton Technology vs. United Microelectronics |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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