Correlation Between Quanta Computer and Nanya Technology
Can any of the company-specific risk be diversified away by investing in both Quanta Computer and Nanya 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 Quanta Computer and Nanya Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Quanta Computer and Nanya Technology Corp, you can compare the effects of market volatilities on Quanta Computer and Nanya 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 Quanta Computer with a short position of Nanya Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quanta Computer and Nanya Technology.
Diversification Opportunities for Quanta Computer and Nanya Technology
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Quanta and Nanya is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Quanta Computer and Nanya Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanya Technology Corp and Quanta Computer 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 Quanta Computer are associated (or correlated) with Nanya Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanya Technology Corp has no effect on the direction of Quanta Computer i.e., Quanta Computer and Nanya Technology go up and down completely randomly.
Pair Corralation between Quanta Computer and Nanya Technology
Assuming the 90 days trading horizon Quanta Computer is expected to generate 1.13 times more return on investment than Nanya Technology. However, Quanta Computer is 1.13 times more volatile than Nanya Technology Corp. It trades about -0.05 of its potential returns per unit of risk. Nanya Technology Corp is currently generating about -0.42 per unit of risk. If you would invest 30,500 in Quanta Computer on August 25, 2024 and sell it today you would lose (800.00) from holding Quanta Computer or give up 2.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Quanta Computer vs. Nanya Technology Corp
Performance |
| Timeline |
| Quanta Computer |
| Nanya Technology Corp |
Quanta Computer and Nanya Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Quanta Computer and Nanya Technology
The main advantage of trading using opposite Quanta Computer and Nanya Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quanta Computer position performs unexpectedly, Nanya 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 Nanya Technology will offset losses from the drop in Nanya Technology's long position.The idea behind Quanta Computer and Nanya Technology Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Nanya Technology vs. Novatek Microelectronics Corp | Nanya Technology vs. Quanta Computer | Nanya Technology vs. United Microelectronics |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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