Correlation Between Asia Optical and Unimicron Technology
Can any of the company-specific risk be diversified away by investing in both Asia Optical and Unimicron Technology 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 Asia Optical and Unimicron Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asia Optical Co and Unimicron Technology Corp, you can compare the effects of market volatilities on Asia Optical and Unimicron Technology 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 Asia Optical with a short position of Unimicron Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Optical and Unimicron Technology.
Diversification Opportunities for Asia Optical and Unimicron Technology
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Asia and Unimicron is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Asia Optical Co and Unimicron Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unimicron Technology Corp and Asia Optical 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 Asia Optical Co are associated (or correlated) with Unimicron Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unimicron Technology Corp has no effect on the direction of Asia Optical i.e., Asia Optical and Unimicron Technology go up and down completely randomly.
Pair Corralation between Asia Optical and Unimicron Technology
Assuming the 90 days trading horizon Asia Optical Co is expected to generate 1.14 times more return on investment than Unimicron Technology. However, Asia Optical is 1.14 times more volatile than Unimicron Technology Corp. It trades about 0.13 of its potential returns per unit of risk. Unimicron Technology Corp is currently generating about -0.04 per unit of risk. If you would invest 6,650 in Asia Optical Co on September 2, 2024 and sell it today you would earn a total of 4,100 from holding Asia Optical Co or generate 61.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia Optical Co vs. Unimicron Technology Corp
Performance |
| Timeline |
| Asia Optical |
| Unimicron Technology Corp |
Asia Optical and Unimicron Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia Optical and Unimicron Technology
The main advantage of trading using opposite Asia Optical and Unimicron Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Optical position performs unexpectedly, Unimicron Technology 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 Unimicron Technology will offset losses from the drop in Unimicron Technology's long position.| Asia Optical vs. LARGAN Precision Co | Asia Optical vs. Novatek Microelectronics Corp | Asia Optical vs. Genius Electronic Optical | Asia Optical vs. Catcher Technology Co |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |