Correlation Between Winbond Electronics and Accton Technology
Can any of the company-specific risk be diversified away by investing in both Winbond Electronics 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 Winbond Electronics and Accton Technology 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 Accton Technology Corp, you can compare the effects of market volatilities on Winbond Electronics 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 Winbond Electronics with a short position of Accton Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Winbond Electronics and Accton Technology.
Diversification Opportunities for Winbond Electronics and Accton Technology
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Winbond and Accton is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Winbond Electronics 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 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 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 Winbond Electronics i.e., Winbond Electronics and Accton Technology go up and down completely randomly.
Pair Corralation between Winbond Electronics and Accton Technology
Assuming the 90 days trading horizon Winbond Electronics Corp is expected to under-perform the Accton Technology. But the stock apears to be less risky and, when comparing its historical volatility, Winbond Electronics Corp is 1.41 times less risky than Accton Technology. The stock trades about -0.28 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 28, 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 | 95.45% |
| Values | Daily Returns |
Winbond Electronics Corp vs. Accton Technology Corp
Performance |
| Timeline |
| Winbond Electronics Corp |
| Accton Technology Corp |
Winbond Electronics and Accton Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Winbond Electronics and Accton Technology
The main advantage of trading using opposite Winbond Electronics and Accton Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Winbond Electronics 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.| Winbond Electronics vs. Macronix International Co | Winbond Electronics vs. United Microelectronics | Winbond Electronics vs. Mosel Vitelic | Winbond Electronics vs. Nanya Technology Corp |
| Accton Technology vs. D Link Corp | Accton Technology vs. Realtek Semiconductor Corp | Accton Technology vs. Winbond Electronics Corp | Accton Technology vs. Compal Electronics |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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