Correlation Between Unimicron Technology and Wah Lee
Can any of the company-specific risk be diversified away by investing in both Unimicron Technology and Wah Lee 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 Unimicron Technology and Wah Lee into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Unimicron Technology Corp and Wah Lee Industrial, you can compare the effects of market volatilities on Unimicron Technology and Wah Lee 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 Unimicron Technology with a short position of Wah Lee. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unimicron Technology and Wah Lee.
Diversification Opportunities for Unimicron Technology and Wah Lee
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Unimicron and Wah is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Unimicron Technology Corp and Wah Lee Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wah Lee Industrial and Unimicron Technology 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 Unimicron Technology Corp are associated (or correlated) with Wah Lee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wah Lee Industrial has no effect on the direction of Unimicron Technology i.e., Unimicron Technology and Wah Lee go up and down completely randomly.
Pair Corralation between Unimicron Technology and Wah Lee
Assuming the 90 days trading horizon Unimicron Technology Corp is expected to generate 1.32 times more return on investment than Wah Lee. However, Unimicron Technology is 1.32 times more volatile than Wah Lee Industrial. It trades about -0.09 of its potential returns per unit of risk. Wah Lee Industrial is currently generating about -0.28 per unit of risk. If you would invest 14,500 in Unimicron Technology Corp on October 26, 2024 and sell it today you would lose (600.00) from holding Unimicron Technology Corp or give up 4.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Unimicron Technology Corp vs. Wah Lee Industrial
Performance |
| Timeline |
| Unimicron Technology Corp |
| Wah Lee Industrial |
Unimicron Technology and Wah Lee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Unimicron Technology and Wah Lee
The main advantage of trading using opposite Unimicron Technology and Wah Lee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unimicron Technology position performs unexpectedly, Wah Lee 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 Wah Lee will offset losses from the drop in Wah Lee's long position.| Unimicron Technology vs. Nan Ya Printed | Unimicron Technology vs. Kinsus Interconnect Technology | Unimicron Technology vs. Novatek Microelectronics Corp | Unimicron Technology vs. LARGAN Precision Co |
| Wah Lee vs. Unimicron Technology Corp | Wah Lee vs. Kinsus Interconnect Technology | Wah Lee vs. Novatek Microelectronics Corp | Wah Lee 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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