Correlation Between Huang Hsiang and Advanced Wireless
Can any of the company-specific risk be diversified away by investing in both Huang Hsiang and Advanced Wireless 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 Huang Hsiang and Advanced Wireless into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Huang Hsiang Construction and Advanced Wireless Semiconductor, you can compare the effects of market volatilities on Huang Hsiang and Advanced Wireless 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 Huang Hsiang with a short position of Advanced Wireless. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huang Hsiang and Advanced Wireless.
Diversification Opportunities for Huang Hsiang and Advanced Wireless
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Huang and Advanced is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Huang Hsiang Construction and Advanced Wireless Semiconducto in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advanced Wireless and Huang Hsiang 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 Huang Hsiang Construction are associated (or correlated) with Advanced Wireless. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advanced Wireless has no effect on the direction of Huang Hsiang i.e., Huang Hsiang and Advanced Wireless go up and down completely randomly.
Pair Corralation between Huang Hsiang and Advanced Wireless
Assuming the 90 days trading horizon Huang Hsiang Construction is expected to generate 1.23 times more return on investment than Advanced Wireless. However, Huang Hsiang is 1.23 times more volatile than Advanced Wireless Semiconductor. It trades about 0.4 of its potential returns per unit of risk. Advanced Wireless Semiconductor is currently generating about 0.26 per unit of risk. If you would invest 6,060 in Huang Hsiang Construction on September 4, 2024 and sell it today you would earn a total of 1,560 from holding Huang Hsiang Construction or generate 25.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huang Hsiang Construction vs. Advanced Wireless Semiconducto
Performance |
| Timeline |
| Huang Hsiang Construction |
| Advanced Wireless |
Huang Hsiang and Advanced Wireless Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huang Hsiang and Advanced Wireless
The main advantage of trading using opposite Huang Hsiang and Advanced Wireless positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huang Hsiang position performs unexpectedly, Advanced Wireless 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 Advanced Wireless will offset losses from the drop in Advanced Wireless' long position.| Huang Hsiang vs. Huaku Development Co | Huang Hsiang vs. Ruentex Development Co | Huang Hsiang vs. Taiwan Cement Corp | Huang Hsiang vs. Symtek Automation Asia |
| Advanced Wireless vs. Sitronix Technology Corp | Advanced Wireless vs. Kinsus Interconnect Technology | Advanced Wireless vs. WiseChip Semiconductor | Advanced Wireless vs. Novatek Microelectronics 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |