Correlation Between Unimicron Technology and EMemory Technology
Can any of the company-specific risk be diversified away by investing in both Unimicron Technology and EMemory 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 Unimicron Technology and EMemory Technology 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 eMemory Technology, you can compare the effects of market volatilities on Unimicron Technology and EMemory 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 Unimicron Technology with a short position of EMemory Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unimicron Technology and EMemory Technology.
Diversification Opportunities for Unimicron Technology and EMemory Technology
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Unimicron and EMemory is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Unimicron Technology Corp and eMemory Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on eMemory Technology 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 EMemory Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of eMemory Technology has no effect on the direction of Unimicron Technology i.e., Unimicron Technology and EMemory Technology go up and down completely randomly.
Pair Corralation between Unimicron Technology and EMemory Technology
Assuming the 90 days trading horizon Unimicron Technology is expected to generate 91.16 times less return on investment than EMemory Technology. But when comparing it to its historical volatility, Unimicron Technology Corp is 1.27 times less risky than EMemory Technology. It trades about 0.0 of its potential returns per unit of risk. eMemory Technology is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 173,307 in eMemory Technology on August 26, 2024 and sell it today you would earn a total of 126,693 from holding eMemory Technology or generate 73.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Unimicron Technology Corp vs. eMemory Technology
Performance |
| Timeline |
| Unimicron Technology Corp |
| eMemory Technology |
Unimicron Technology and EMemory Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Unimicron Technology and EMemory Technology
The main advantage of trading using opposite Unimicron Technology and EMemory Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unimicron Technology position performs unexpectedly, EMemory 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 EMemory Technology will offset losses from the drop in EMemory Technology's long position.| Unimicron Technology vs. Novatek Microelectronics Corp | Unimicron Technology vs. Quanta Computer | Unimicron Technology vs. United Microelectronics |
| EMemory Technology vs. Global Unichip Corp | EMemory Technology vs. Asmedia Technology | EMemory Technology vs. Unimicron Technology Corp | EMemory Technology vs. Novatek Microelectronics Corp |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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