Correlation Between LARGAN Precision and BenQ Medical
Can any of the company-specific risk be diversified away by investing in both LARGAN Precision and BenQ Medical 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 LARGAN Precision and BenQ Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LARGAN Precision Co and BenQ Medical Technology, you can compare the effects of market volatilities on LARGAN Precision and BenQ Medical 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 LARGAN Precision with a short position of BenQ Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of LARGAN Precision and BenQ Medical.
Diversification Opportunities for LARGAN Precision and BenQ Medical
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between LARGAN and BenQ is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding LARGAN Precision Co and BenQ Medical Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BenQ Medical Technology and LARGAN Precision 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 LARGAN Precision Co are associated (or correlated) with BenQ Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BenQ Medical Technology has no effect on the direction of LARGAN Precision i.e., LARGAN Precision and BenQ Medical go up and down completely randomly.
Pair Corralation between LARGAN Precision and BenQ Medical
Assuming the 90 days trading horizon LARGAN Precision Co is expected to generate 2.35 times more return on investment than BenQ Medical. However, LARGAN Precision is 2.35 times more volatile than BenQ Medical Technology. It trades about 0.15 of its potential returns per unit of risk. BenQ Medical Technology is currently generating about -0.24 per unit of risk. If you would invest 258,000 in LARGAN Precision Co on October 26, 2024 and sell it today you would earn a total of 17,000 from holding LARGAN Precision Co or generate 6.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LARGAN Precision Co vs. BenQ Medical Technology
Performance |
| Timeline |
| LARGAN Precision |
| BenQ Medical Technology |
LARGAN Precision and BenQ Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LARGAN Precision and BenQ Medical
The main advantage of trading using opposite LARGAN Precision and BenQ Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LARGAN Precision position performs unexpectedly, BenQ Medical 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 BenQ Medical will offset losses from the drop in BenQ Medical's long position.| LARGAN Precision vs. MediaTek | LARGAN Precision vs. Hon Hai Precision | LARGAN Precision vs. Delta Electronics | LARGAN Precision vs. Catcher Technology Co |
| BenQ Medical vs. Sunspring Metal Corp | BenQ Medical vs. AVer Information | BenQ Medical vs. Jentech Precision Industrial | BenQ Medical vs. Transcend Information |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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