Correlation Between Quanta Computer and Aker Technology
Can any of the company-specific risk be diversified away by investing in both Quanta Computer and Aker 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 Aker 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 Aker Technology Co, you can compare the effects of market volatilities on Quanta Computer and Aker 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 Aker Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quanta Computer and Aker Technology.
Diversification Opportunities for Quanta Computer and Aker Technology
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Quanta and Aker is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Quanta Computer and Aker Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aker Technology 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 Aker Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aker Technology has no effect on the direction of Quanta Computer i.e., Quanta Computer and Aker Technology go up and down completely randomly.
Pair Corralation between Quanta Computer and Aker Technology
Assuming the 90 days trading horizon Quanta Computer is expected to generate 1.03 times more return on investment than Aker Technology. However, Quanta Computer is 1.03 times more volatile than Aker Technology Co. It trades about 0.06 of its potential returns per unit of risk. Aker Technology Co is currently generating about 0.02 per unit of risk. If you would invest 20,350 in Quanta Computer on September 14, 2024 and sell it today you would earn a total of 8,250 from holding Quanta Computer or generate 40.54% 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. Aker Technology Co
Performance |
| Timeline |
| Quanta Computer |
| Aker Technology |
Quanta Computer and Aker Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Quanta Computer and Aker Technology
The main advantage of trading using opposite Quanta Computer and Aker Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quanta Computer position performs unexpectedly, Aker 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 Aker Technology will offset losses from the drop in Aker Technology's long position.| Quanta Computer vs. Compal Electronics | Quanta Computer vs. Asustek Computer | Quanta Computer vs. Delta Electronics | Quanta Computer vs. Inventec Corp |
| Aker Technology vs. Materials Analysis Technology | Aker Technology vs. Genovate Biotechnology Co | Aker Technology vs. Shan Loong Transportation Co | Aker Technology vs. Thermaltake 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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