Correlation Between Accton Technology and Skardin Industrial
Can any of the company-specific risk be diversified away by investing in both Accton Technology and Skardin Industrial 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 Accton Technology and Skardin Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Accton Technology Corp and Skardin Industrial, you can compare the effects of market volatilities on Accton Technology and Skardin Industrial 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 Accton Technology with a short position of Skardin Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Accton Technology and Skardin Industrial.
Diversification Opportunities for Accton Technology and Skardin Industrial
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Accton and Skardin is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Accton Technology Corp and Skardin Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Skardin Industrial and Accton Technology 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 Accton Technology Corp are associated (or correlated) with Skardin Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Skardin Industrial has no effect on the direction of Accton Technology i.e., Accton Technology and Skardin Industrial go up and down completely randomly.
Pair Corralation between Accton Technology and Skardin Industrial
Assuming the 90 days trading horizon Accton Technology Corp is expected to generate 0.79 times more return on investment than Skardin Industrial. However, Accton Technology Corp is 1.27 times less risky than Skardin Industrial. It trades about 0.38 of its potential returns per unit of risk. Skardin Industrial is currently generating about 0.05 per unit of risk. If you would invest 54,200 in Accton Technology Corp on September 3, 2024 and sell it today you would earn a total of 11,500 from holding Accton Technology Corp or generate 21.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Accton Technology Corp vs. Skardin Industrial
Performance |
| Timeline |
| Accton Technology Corp |
| Skardin Industrial |
Accton Technology and Skardin Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Accton Technology and Skardin Industrial
The main advantage of trading using opposite Accton Technology and Skardin Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Accton Technology position performs unexpectedly, Skardin Industrial 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 Skardin Industrial will offset losses from the drop in Skardin Industrial's long position.| Accton Technology vs. Taiwan Semiconductor Manufacturing | Accton Technology vs. Yang Ming Marine | Accton Technology vs. ASE Industrial Holding | Accton Technology vs. AU Optronics |
| Skardin Industrial vs. Accton Technology Corp | Skardin Industrial vs. Wistron NeWeb Corp | Skardin Industrial vs. Alpha Networks | Skardin Industrial vs. Gemtek Technology 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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