Correlation Between Elan Microelectronics and Ampoc Far
Can any of the company-specific risk be diversified away by investing in both Elan Microelectronics and Ampoc Far 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 Elan Microelectronics and Ampoc Far into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elan Microelectronics Corp and Ampoc Far East Co, you can compare the effects of market volatilities on Elan Microelectronics and Ampoc Far 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 Elan Microelectronics with a short position of Ampoc Far. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elan Microelectronics and Ampoc Far.
Diversification Opportunities for Elan Microelectronics and Ampoc Far
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Elan and Ampoc is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Elan Microelectronics Corp and Ampoc Far East Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ampoc Far East and Elan Microelectronics 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 Elan Microelectronics Corp are associated (or correlated) with Ampoc Far. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ampoc Far East has no effect on the direction of Elan Microelectronics i.e., Elan Microelectronics and Ampoc Far go up and down completely randomly.
Pair Corralation between Elan Microelectronics and Ampoc Far
Assuming the 90 days trading horizon Elan Microelectronics is expected to generate 4.69 times less return on investment than Ampoc Far. But when comparing it to its historical volatility, Elan Microelectronics Corp is 1.13 times less risky than Ampoc Far. It trades about 0.02 of its potential returns per unit of risk. Ampoc Far East Co is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 7,170 in Ampoc Far East Co on September 4, 2024 and sell it today you would earn a total of 3,230 from holding Ampoc Far East Co or generate 45.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elan Microelectronics Corp vs. Ampoc Far East Co
Performance |
| Timeline |
| Elan Microelectronics |
| Ampoc Far East |
Elan Microelectronics and Ampoc Far Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elan Microelectronics and Ampoc Far
The main advantage of trading using opposite Elan Microelectronics and Ampoc Far positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elan Microelectronics position performs unexpectedly, Ampoc Far 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 Ampoc Far will offset losses from the drop in Ampoc Far's long position.| Elan Microelectronics vs. Taiwan Semiconductor Manufacturing | Elan Microelectronics vs. Yang Ming Marine | Elan Microelectronics vs. ASE Industrial Holding | Elan Microelectronics vs. AU Optronics |
| Ampoc Far vs. Greatek Electronics | Ampoc Far vs. Stark Technology | Ampoc Far vs. Elan Microelectronics Corp | Ampoc Far vs. Wellell |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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