Correlation Between MediaTek and Senao International
Can any of the company-specific risk be diversified away by investing in both MediaTek and Senao International 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 MediaTek and Senao International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MediaTek and Senao International Co, you can compare the effects of market volatilities on MediaTek and Senao International 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 MediaTek with a short position of Senao International. Check out your portfolio center. Please also check ongoing floating volatility patterns of MediaTek and Senao International.
Diversification Opportunities for MediaTek and Senao International
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between MediaTek and Senao is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding MediaTek and Senao International Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Senao International and MediaTek 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 MediaTek are associated (or correlated) with Senao International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Senao International has no effect on the direction of MediaTek i.e., MediaTek and Senao International go up and down completely randomly.
Pair Corralation between MediaTek and Senao International
Assuming the 90 days trading horizon MediaTek is expected to under-perform the Senao International. In addition to that, MediaTek is 3.1 times more volatile than Senao International Co. It trades about -0.09 of its total potential returns per unit of risk. Senao International Co is currently generating about -0.07 per unit of volatility. If you would invest 3,515 in Senao International Co on August 30, 2024 and sell it today you would lose (35.00) from holding Senao International Co or give up 1.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MediaTek vs. Senao International Co
Performance |
| Timeline |
| MediaTek |
| Senao International |
MediaTek and Senao International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MediaTek and Senao International
The main advantage of trading using opposite MediaTek and Senao International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MediaTek position performs unexpectedly, Senao International 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 Senao International will offset losses from the drop in Senao International's long position.| MediaTek vs. Hon Hai Precision | MediaTek vs. United Microelectronics | MediaTek vs. LARGAN Precision Co | MediaTek vs. Delta Electronics |
| Senao International vs. Hung Sheng Construction | Senao International vs. Chien Kuo Construction | Senao International vs. Dawushan Farm Tech | Senao International vs. Kao Fong Machinery |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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