Correlation Between Winbond Electronics and Nan Ya
Can any of the company-specific risk be diversified away by investing in both Winbond Electronics 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 Winbond Electronics and Nan Ya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Winbond Electronics Corp and Nan Ya Plastics, you can compare the effects of market volatilities on Winbond Electronics 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 Winbond Electronics with a short position of Nan Ya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Winbond Electronics and Nan Ya.
Diversification Opportunities for Winbond Electronics and Nan Ya
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Winbond and Nan is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Winbond Electronics Corp and Nan Ya Plastics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nan Ya Plastics and Winbond Electronics 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 Winbond Electronics Corp 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 Plastics has no effect on the direction of Winbond Electronics i.e., Winbond Electronics and Nan Ya go up and down completely randomly.
Pair Corralation between Winbond Electronics and Nan Ya
Assuming the 90 days trading horizon Winbond Electronics Corp is expected to generate 1.48 times more return on investment than Nan Ya. However, Winbond Electronics is 1.48 times more volatile than Nan Ya Plastics. It trades about -0.01 of its potential returns per unit of risk. Nan Ya Plastics is currently generating about -0.09 per unit of risk. If you would invest 2,070 in Winbond Electronics Corp on August 30, 2024 and sell it today you would lose (410.00) from holding Winbond Electronics Corp or give up 19.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Winbond Electronics Corp vs. Nan Ya Plastics
Performance |
| Timeline |
| Winbond Electronics Corp |
| Nan Ya Plastics |
Winbond Electronics and Nan Ya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Winbond Electronics and Nan Ya
The main advantage of trading using opposite Winbond Electronics and Nan Ya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Winbond Electronics 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.| Winbond Electronics vs. Macronix International Co | Winbond Electronics vs. United Microelectronics | Winbond Electronics vs. Mosel Vitelic | Winbond Electronics vs. Nanya Technology Corp |
| Nan Ya vs. Formosa Plastics Corp | Nan Ya vs. Formosa Chemicals Fibre | Nan Ya vs. China Steel Corp | Nan Ya vs. Formosa Petrochemical 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |