Correlation Between Asia Optical and Hannstar Display
Can any of the company-specific risk be diversified away by investing in both Asia Optical and Hannstar Display 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 Hannstar Display 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 Hannstar Display Corp, you can compare the effects of market volatilities on Asia Optical and Hannstar Display 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 Hannstar Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Optical and Hannstar Display.
Diversification Opportunities for Asia Optical and Hannstar Display
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Asia and Hannstar is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Asia Optical Co and Hannstar Display Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hannstar Display 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 Hannstar Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hannstar Display Corp has no effect on the direction of Asia Optical i.e., Asia Optical and Hannstar Display go up and down completely randomly.
Pair Corralation between Asia Optical and Hannstar Display
Assuming the 90 days trading horizon Asia Optical Co is expected to generate 2.26 times more return on investment than Hannstar Display. However, Asia Optical is 2.26 times more volatile than Hannstar Display Corp. It trades about 0.14 of its potential returns per unit of risk. Hannstar Display Corp is currently generating about -0.05 per unit of risk. If you would invest 8,610 in Asia Optical Co on October 26, 2024 and sell it today you would earn a total of 7,190 from holding Asia Optical Co or generate 83.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia Optical Co vs. Hannstar Display Corp
Performance |
| Timeline |
| Asia Optical |
| Hannstar Display Corp |
Asia Optical and Hannstar Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia Optical and Hannstar Display
The main advantage of trading using opposite Asia Optical and Hannstar Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Optical position performs unexpectedly, Hannstar Display 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 Hannstar Display will offset losses from the drop in Hannstar Display'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 |
| Hannstar Display vs. Unimicron Technology Corp | Hannstar Display vs. Kinsus Interconnect Technology | Hannstar Display vs. Novatek Microelectronics Corp | Hannstar Display 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Transaction History View history of all your transactions and understand their impact on performance |