Correlation Between AU Optronics and Trade Van
Can any of the company-specific risk be diversified away by investing in both AU Optronics and Trade Van 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 AU Optronics and Trade Van into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AU Optronics and Trade Van Information Services, you can compare the effects of market volatilities on AU Optronics and Trade Van 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 AU Optronics with a short position of Trade Van. Check out your portfolio center. Please also check ongoing floating volatility patterns of AU Optronics and Trade Van.
Diversification Opportunities for AU Optronics and Trade Van
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 2409 and Trade is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding AU Optronics and Trade Van Information Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trade Van Information and AU Optronics 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 AU Optronics are associated (or correlated) with Trade Van. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trade Van Information has no effect on the direction of AU Optronics i.e., AU Optronics and Trade Van go up and down completely randomly.
Pair Corralation between AU Optronics and Trade Van
Assuming the 90 days trading horizon AU Optronics is expected to under-perform the Trade Van. In addition to that, AU Optronics is 1.56 times more volatile than Trade Van Information Services. It trades about -0.03 of its total potential returns per unit of risk. Trade Van Information Services is currently generating about 0.18 per unit of volatility. If you would invest 7,390 in Trade Van Information Services on September 12, 2024 and sell it today you would earn a total of 820.00 from holding Trade Van Information Services or generate 11.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AU Optronics vs. Trade Van Information Services
Performance |
| Timeline |
| AU Optronics |
| Trade Van Information |
AU Optronics and Trade Van Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AU Optronics and Trade Van
The main advantage of trading using opposite AU Optronics and Trade Van positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AU Optronics position performs unexpectedly, Trade Van 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 Trade Van will offset losses from the drop in Trade Van's long position.| AU Optronics vs. Innolux Corp | AU Optronics vs. United Microelectronics | AU Optronics vs. China Steel Corp | AU Optronics vs. Quanta Computer |
| Trade Van vs. AU Optronics | Trade Van vs. Innolux Corp | Trade Van vs. Ruentex Development Co | Trade Van vs. WiseChip Semiconductor |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |