Correlation Between Kee Tai and Taiwan Glass
Can any of the company-specific risk be diversified away by investing in both Kee Tai and Taiwan Glass 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 Kee Tai and Taiwan Glass into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kee Tai Properties and Taiwan Glass Ind, you can compare the effects of market volatilities on Kee Tai and Taiwan Glass 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 Kee Tai with a short position of Taiwan Glass. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kee Tai and Taiwan Glass.
Diversification Opportunities for Kee Tai and Taiwan Glass
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kee and Taiwan is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Kee Tai Properties and Taiwan Glass Ind in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taiwan Glass Ind and Kee Tai 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 Kee Tai Properties are associated (or correlated) with Taiwan Glass. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taiwan Glass Ind has no effect on the direction of Kee Tai i.e., Kee Tai and Taiwan Glass go up and down completely randomly.
Pair Corralation between Kee Tai and Taiwan Glass
Assuming the 90 days trading horizon Kee Tai Properties is expected to under-perform the Taiwan Glass. But the stock apears to be less risky and, when comparing its historical volatility, Kee Tai Properties is 2.33 times less risky than Taiwan Glass. The stock trades about -0.04 of its potential returns per unit of risk. The Taiwan Glass Ind is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,860 in Taiwan Glass Ind on August 26, 2024 and sell it today you would earn a total of 205.00 from holding Taiwan Glass Ind or generate 11.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kee Tai Properties vs. Taiwan Glass Ind
Performance |
| Timeline |
| Kee Tai Properties |
| Taiwan Glass Ind |
Kee Tai and Taiwan Glass Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kee Tai and Taiwan Glass
The main advantage of trading using opposite Kee Tai and Taiwan Glass positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kee Tai position performs unexpectedly, Taiwan Glass 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 Taiwan Glass will offset losses from the drop in Taiwan Glass' long position.| Kee Tai vs. Chainqui Construction Development | Kee Tai vs. Zinwell | Kee Tai vs. Symtek Automation Asia | Kee Tai vs. CTCI Corp |
| Taiwan Glass vs. Sunny Friend Environmental | Taiwan Glass vs. TTET Union Corp | Taiwan Glass vs. ECOVE Environment Corp | Taiwan Glass vs. Yulon Finance Corp |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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