Correlation Between Emerging Display and Asia Electronic
Can any of the company-specific risk be diversified away by investing in both Emerging Display and Asia Electronic 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 Emerging Display and Asia Electronic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Emerging Display Technologies and Asia Electronic Material, you can compare the effects of market volatilities on Emerging Display and Asia Electronic 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 Emerging Display with a short position of Asia Electronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerging Display and Asia Electronic.
Diversification Opportunities for Emerging Display and Asia Electronic
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Emerging and Asia is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Emerging Display Technologies and Asia Electronic Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Electronic Material and Emerging Display 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 Emerging Display Technologies are associated (or correlated) with Asia Electronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Electronic Material has no effect on the direction of Emerging Display i.e., Emerging Display and Asia Electronic go up and down completely randomly.
Pair Corralation between Emerging Display and Asia Electronic
Assuming the 90 days trading horizon Emerging Display Technologies is expected to generate 1.73 times more return on investment than Asia Electronic. However, Emerging Display is 1.73 times more volatile than Asia Electronic Material. It trades about 0.11 of its potential returns per unit of risk. Asia Electronic Material is currently generating about 0.08 per unit of risk. If you would invest 2,565 in Emerging Display Technologies on October 20, 2024 and sell it today you would earn a total of 130.00 from holding Emerging Display Technologies or generate 5.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Emerging Display Technologies vs. Asia Electronic Material
Performance |
| Timeline |
| Emerging Display Tec |
| Asia Electronic Material |
Emerging Display and Asia Electronic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Emerging Display and Asia Electronic
The main advantage of trading using opposite Emerging Display and Asia Electronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Emerging Display position performs unexpectedly, Asia Electronic 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 Electronic will offset losses from the drop in Asia Electronic's long position.| Emerging Display vs. ASRock Inc | Emerging Display vs. FIC Global | Emerging Display vs. In Win Development | Emerging Display vs. Getac Technology Corp |
| Asia Electronic vs. Gloria Material Technology | Asia Electronic vs. U Tech Media Corp | Asia Electronic vs. Goldsun Building Materials | Asia Electronic vs. Softstar Entertainment |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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