Correlation Between Quanta Computer and MiTAC Holdings
Can any of the company-specific risk be diversified away by investing in both Quanta Computer and MiTAC Holdings 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 MiTAC Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Quanta Computer and MiTAC Holdings Corp, you can compare the effects of market volatilities on Quanta Computer and MiTAC Holdings 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 MiTAC Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quanta Computer and MiTAC Holdings.
Diversification Opportunities for Quanta Computer and MiTAC Holdings
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Quanta and MiTAC is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Quanta Computer and MiTAC Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MiTAC Holdings 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 MiTAC Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MiTAC Holdings Corp has no effect on the direction of Quanta Computer i.e., Quanta Computer and MiTAC Holdings go up and down completely randomly.
Pair Corralation between Quanta Computer and MiTAC Holdings
Assuming the 90 days trading horizon Quanta Computer is expected to under-perform the MiTAC Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Quanta Computer is 2.15 times less risky than MiTAC Holdings. The stock trades about -0.11 of its potential returns per unit of risk. The MiTAC Holdings Corp is currently generating about 0.61 of returns per unit of risk over similar time horizon. If you would invest 4,595 in MiTAC Holdings Corp on August 30, 2024 and sell it today you would earn a total of 3,785 from holding MiTAC Holdings Corp or generate 82.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Quanta Computer vs. MiTAC Holdings Corp
Performance |
| Timeline |
| Quanta Computer |
| MiTAC Holdings Corp |
Quanta Computer and MiTAC Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Quanta Computer and MiTAC Holdings
The main advantage of trading using opposite Quanta Computer and MiTAC Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quanta Computer position performs unexpectedly, MiTAC Holdings 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 MiTAC Holdings will offset losses from the drop in MiTAC Holdings' long position.| Quanta Computer vs. Compal Electronics | Quanta Computer vs. Asustek Computer | Quanta Computer vs. Delta Electronics | Quanta Computer vs. Inventec Corp |
| MiTAC Holdings vs. Wistron Corp | MiTAC Holdings vs. Getac Technology Corp | MiTAC Holdings vs. Inventec Corp | MiTAC Holdings vs. Pegatron 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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