Correlation Between IEI Integration and Asia Vital
Can any of the company-specific risk be diversified away by investing in both IEI Integration and Asia Vital 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 IEI Integration and Asia Vital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IEI Integration Corp and Asia Vital Components, you can compare the effects of market volatilities on IEI Integration and Asia Vital 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 IEI Integration with a short position of Asia Vital. Check out your portfolio center. Please also check ongoing floating volatility patterns of IEI Integration and Asia Vital.
Diversification Opportunities for IEI Integration and Asia Vital
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between IEI and Asia is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding IEI Integration Corp and Asia Vital Components in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Vital Components and IEI Integration 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 IEI Integration Corp are associated (or correlated) with Asia Vital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Vital Components has no effect on the direction of IEI Integration i.e., IEI Integration and Asia Vital go up and down completely randomly.
Pair Corralation between IEI Integration and Asia Vital
Assuming the 90 days trading horizon IEI Integration Corp is expected to generate 0.85 times more return on investment than Asia Vital. However, IEI Integration Corp is 1.17 times less risky than Asia Vital. It trades about 0.2 of its potential returns per unit of risk. Asia Vital Components is currently generating about -0.02 per unit of risk. If you would invest 7,910 in IEI Integration Corp on August 26, 2024 and sell it today you would earn a total of 690.00 from holding IEI Integration Corp or generate 8.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
IEI Integration Corp vs. Asia Vital Components
Performance |
| Timeline |
| IEI Integration Corp |
| Asia Vital Components |
IEI Integration and Asia Vital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IEI Integration and Asia Vital
The main advantage of trading using opposite IEI Integration and Asia Vital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IEI Integration position performs unexpectedly, Asia Vital 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 Asia Vital will offset losses from the drop in Asia Vital's long position.| IEI Integration vs. Advantech Co | IEI Integration vs. Getac Technology Corp | IEI Integration vs. Flytech Technology Co | IEI Integration vs. ADLINK Technology |
| Asia Vital vs. Novatek Microelectronics Corp | Asia Vital vs. Quanta Computer | Asia Vital vs. United Microelectronics |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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