Correlation Between Unimicron Technology and Hannstar Display
Can any of the company-specific risk be diversified away by investing in both Unimicron Technology 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 Unimicron Technology and Hannstar Display 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 Hannstar Display Corp, you can compare the effects of market volatilities on Unimicron Technology 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 Unimicron Technology with a short position of Hannstar Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unimicron Technology and Hannstar Display.
Diversification Opportunities for Unimicron Technology and Hannstar Display
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Unimicron and Hannstar is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Unimicron Technology Corp 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 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 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 Unimicron Technology i.e., Unimicron Technology and Hannstar Display go up and down completely randomly.
Pair Corralation between Unimicron Technology and Hannstar Display
Assuming the 90 days trading horizon Unimicron Technology Corp is expected to under-perform the Hannstar Display. In addition to that, Unimicron Technology is 1.29 times more volatile than Hannstar Display Corp. It trades about -0.15 of its total potential returns per unit of risk. Hannstar Display Corp is currently generating about -0.17 per unit of volatility. If you would invest 899.00 in Hannstar Display Corp on October 26, 2024 and sell it today you would lose (99.00) from holding Hannstar Display Corp or give up 11.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Unimicron Technology Corp vs. Hannstar Display Corp
Performance |
| Timeline |
| Unimicron Technology Corp |
| Hannstar Display Corp |
Unimicron Technology and Hannstar Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Unimicron Technology and Hannstar Display
The main advantage of trading using opposite Unimicron Technology and Hannstar Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unimicron Technology 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.| Unimicron Technology vs. Nan Ya Printed | Unimicron Technology vs. Kinsus Interconnect Technology | Unimicron Technology vs. Novatek Microelectronics Corp | Unimicron Technology vs. LARGAN Precision 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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