Correlation Between Inventec Corp and Concord Securities
Can any of the company-specific risk be diversified away by investing in both Inventec Corp and Concord Securities 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 Inventec Corp and Concord Securities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inventec Corp and Concord Securities Co, you can compare the effects of market volatilities on Inventec Corp and Concord Securities 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 Inventec Corp with a short position of Concord Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inventec Corp and Concord Securities.
Diversification Opportunities for Inventec Corp and Concord Securities
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Inventec and Concord is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Inventec Corp and Concord Securities Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concord Securities and Inventec 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 Inventec Corp are associated (or correlated) with Concord Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concord Securities has no effect on the direction of Inventec Corp i.e., Inventec Corp and Concord Securities go up and down completely randomly.
Pair Corralation between Inventec Corp and Concord Securities
Assuming the 90 days trading horizon Inventec Corp is expected to generate 1.09 times more return on investment than Concord Securities. However, Inventec Corp is 1.09 times more volatile than Concord Securities Co. It trades about 0.04 of its potential returns per unit of risk. Concord Securities Co is currently generating about 0.04 per unit of risk. If you would invest 4,240 in Inventec Corp on August 26, 2024 and sell it today you would earn a total of 830.00 from holding Inventec Corp or generate 19.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inventec Corp vs. Concord Securities Co
Performance |
| Timeline |
| Inventec Corp |
| Concord Securities |
Inventec Corp and Concord Securities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inventec Corp and Concord Securities
The main advantage of trading using opposite Inventec Corp and Concord Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inventec Corp position performs unexpectedly, Concord Securities 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 Concord Securities will offset losses from the drop in Concord Securities' long position.| Inventec Corp vs. Novatek Microelectronics Corp | Inventec Corp vs. Quanta Computer | Inventec Corp vs. United Microelectronics |
| Concord Securities vs. Hung Sheng Construction | Concord Securities vs. Mercuries Life Insurance | Concord Securities vs. Sinher Technology | Concord Securities vs. YungShin Global Holding |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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