Correlation Between Orient Semiconductor and AP Memory
Can any of the company-specific risk be diversified away by investing in both Orient Semiconductor and AP Memory 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 Orient Semiconductor and AP Memory into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Orient Semiconductor Electronics and AP Memory Technology, you can compare the effects of market volatilities on Orient Semiconductor and AP Memory 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 Orient Semiconductor with a short position of AP Memory. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orient Semiconductor and AP Memory.
Diversification Opportunities for Orient Semiconductor and AP Memory
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Orient and 6531 is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Orient Semiconductor Electroni and AP Memory Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AP Memory Technology and Orient Semiconductor 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 Orient Semiconductor Electronics are associated (or correlated) with AP Memory. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AP Memory Technology has no effect on the direction of Orient Semiconductor i.e., Orient Semiconductor and AP Memory go up and down completely randomly.
Pair Corralation between Orient Semiconductor and AP Memory
Assuming the 90 days trading horizon Orient Semiconductor Electronics is expected to generate 1.02 times more return on investment than AP Memory. However, Orient Semiconductor is 1.02 times more volatile than AP Memory Technology. It trades about 0.06 of its potential returns per unit of risk. AP Memory Technology is currently generating about 0.06 per unit of risk. If you would invest 1,760 in Orient Semiconductor Electronics on September 13, 2024 and sell it today you would earn a total of 1,830 from holding Orient Semiconductor Electronics or generate 103.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Orient Semiconductor Electroni vs. AP Memory Technology
Performance |
| Timeline |
| Orient Semiconductor |
| AP Memory Technology |
Orient Semiconductor and AP Memory Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orient Semiconductor and AP Memory
The main advantage of trading using opposite Orient Semiconductor and AP Memory positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orient Semiconductor position performs unexpectedly, AP Memory 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 AP Memory will offset losses from the drop in AP Memory's long position.| Orient Semiconductor vs. AU Optronics | Orient Semiconductor vs. Innolux Corp | Orient Semiconductor vs. Ruentex Development Co | Orient Semiconductor vs. WiseChip Semiconductor |
| AP Memory vs. WIN Semiconductors | AP Memory vs. GlobalWafers Co | AP Memory vs. Novatek Microelectronics Corp | AP Memory vs. Ruentex Development 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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