Correlation Between Yageo Corp and Catcher Technology
Can any of the company-specific risk be diversified away by investing in both Yageo Corp and Catcher 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 Catcher 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 Catcher Technology Co, you can compare the effects of market volatilities on Yageo Corp and Catcher 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 Catcher Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yageo Corp and Catcher Technology.
Diversification Opportunities for Yageo Corp and Catcher Technology
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yageo and Catcher is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Yageo Corp and Catcher Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catcher Technology 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 Catcher Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catcher Technology has no effect on the direction of Yageo Corp i.e., Yageo Corp and Catcher Technology go up and down completely randomly.
Pair Corralation between Yageo Corp and Catcher Technology
Assuming the 90 days trading horizon Yageo Corp is expected to generate 0.99 times more return on investment than Catcher Technology. However, Yageo Corp is 1.01 times less risky than Catcher Technology. It trades about -0.31 of its potential returns per unit of risk. Catcher Technology Co is currently generating about -0.35 per unit of risk. If you would invest 61,400 in Yageo Corp on August 24, 2024 and sell it today you would lose (8,000) from holding Yageo Corp or give up 13.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yageo Corp vs. Catcher Technology Co
Performance |
| Timeline |
| Yageo Corp |
| Catcher Technology |
Yageo Corp and Catcher Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yageo Corp and Catcher Technology
The main advantage of trading using opposite Yageo Corp and Catcher Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yageo Corp position performs unexpectedly, Catcher 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 Catcher Technology will offset losses from the drop in Catcher Technology's long position.| Yageo Corp vs. Novatek Microelectronics Corp | Yageo Corp vs. MediaTek | Yageo Corp vs. Quanta Computer | Yageo Corp vs. United Microelectronics |
| Catcher Technology vs. LARGAN Precision Co | Catcher Technology vs. Delta Electronics | Catcher Technology vs. Quanta Computer | Catcher Technology vs. Pegatron 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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