Correlation Between ESUN Financial and Microelectronics
Can any of the company-specific risk be diversified away by investing in both ESUN Financial and Microelectronics 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 ESUN Financial and Microelectronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ESUN Financial Holding and Microelectronics Technology, you can compare the effects of market volatilities on ESUN Financial and Microelectronics 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 ESUN Financial with a short position of Microelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of ESUN Financial and Microelectronics.
Diversification Opportunities for ESUN Financial and Microelectronics
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between ESUN and Microelectronics is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding ESUN Financial Holding and Microelectronics Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microelectronics Tec and ESUN Financial 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 ESUN Financial Holding are associated (or correlated) with Microelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microelectronics Tec has no effect on the direction of ESUN Financial i.e., ESUN Financial and Microelectronics go up and down completely randomly.
Pair Corralation between ESUN Financial and Microelectronics
Assuming the 90 days trading horizon ESUN Financial Holding is expected to generate 0.21 times more return on investment than Microelectronics. However, ESUN Financial Holding is 4.75 times less risky than Microelectronics. It trades about 0.04 of its potential returns per unit of risk. Microelectronics Technology is currently generating about -0.07 per unit of risk. If you would invest 2,765 in ESUN Financial Holding on October 25, 2024 and sell it today you would earn a total of 15.00 from holding ESUN Financial Holding or generate 0.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ESUN Financial Holding vs. Microelectronics Technology
Performance |
| Timeline |
| ESUN Financial Holding |
| Microelectronics Tec |
ESUN Financial and Microelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ESUN Financial and Microelectronics
The main advantage of trading using opposite ESUN Financial and Microelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ESUN Financial position performs unexpectedly, Microelectronics 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 Microelectronics will offset losses from the drop in Microelectronics' long position.| ESUN Financial vs. Mega Financial Holding | ESUN Financial vs. CTBC Financial Holding | ESUN Financial vs. First Financial Holding | ESUN Financial vs. Fubon Financial Holding |
| Microelectronics vs. Unimicron Technology Corp | Microelectronics vs. Kinsus Interconnect Technology | Microelectronics vs. Novatek Microelectronics Corp | Microelectronics vs. Delta Electronics |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |