Correlation Between United Integrated and Chicony Electronics
Can any of the company-specific risk be diversified away by investing in both United Integrated and Chicony Electronics 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 United Integrated and Chicony Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Integrated Services and Chicony Electronics Co, you can compare the effects of market volatilities on United Integrated and Chicony Electronics 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 United Integrated with a short position of Chicony Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Integrated and Chicony Electronics.
Diversification Opportunities for United Integrated and Chicony Electronics
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between United and Chicony is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding United Integrated Services and Chicony Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chicony Electronics and United Integrated 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 United Integrated Services are associated (or correlated) with Chicony Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chicony Electronics has no effect on the direction of United Integrated i.e., United Integrated and Chicony Electronics go up and down completely randomly.
Pair Corralation between United Integrated and Chicony Electronics
Assuming the 90 days trading horizon United Integrated Services is expected to under-perform the Chicony Electronics. In addition to that, United Integrated is 1.63 times more volatile than Chicony Electronics Co. It trades about -0.33 of its total potential returns per unit of risk. Chicony Electronics Co is currently generating about 0.26 per unit of volatility. If you would invest 15,550 in Chicony Electronics Co on November 27, 2024 and sell it today you would earn a total of 700.00 from holding Chicony Electronics Co or generate 4.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Integrated Services vs. Chicony Electronics Co
Performance |
| Timeline |
| United Integrated |
| Chicony Electronics |
United Integrated and Chicony Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Integrated and Chicony Electronics
The main advantage of trading using opposite United Integrated and Chicony Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Integrated position performs unexpectedly, Chicony Electronics 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 Chicony Electronics will offset losses from the drop in Chicony Electronics' long position.| United Integrated vs. Chicony Electronics Co | United Integrated vs. Delta Electronics | United Integrated vs. Greatek Electronics | United Integrated vs. Realtek Semiconductor Corp |
| Chicony Electronics vs. Lite On Technology Corp | Chicony Electronics vs. Inventec Corp | Chicony Electronics vs. Compal Electronics | Chicony Electronics vs. Synnex Technology International |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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