Correlation Between Emerging Display and Hannstar Display
Can any of the company-specific risk be diversified away by investing in both Emerging Display 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 Emerging Display and Hannstar Display 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 Hannstar Display Corp, you can compare the effects of market volatilities on Emerging Display 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 Emerging Display with a short position of Hannstar Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerging Display and Hannstar Display.
Diversification Opportunities for Emerging Display and Hannstar Display
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Emerging and Hannstar is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Emerging Display Technologies 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 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 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 Emerging Display i.e., Emerging Display and Hannstar Display go up and down completely randomly.
Pair Corralation between Emerging Display and Hannstar Display
Assuming the 90 days trading horizon Emerging Display Technologies is expected to generate 0.8 times more return on investment than Hannstar Display. However, Emerging Display Technologies is 1.24 times less risky than Hannstar Display. It trades about 0.23 of its potential returns per unit of risk. Hannstar Display Corp is currently generating about -0.08 per unit of risk. If you would invest 2,605 in Emerging Display Technologies on August 28, 2024 and sell it today you would earn a total of 150.00 from holding Emerging Display Technologies or generate 5.76% 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. Hannstar Display Corp
Performance |
| Timeline |
| Emerging Display Tec |
| Hannstar Display Corp |
Emerging Display and Hannstar Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Emerging Display and Hannstar Display
The main advantage of trading using opposite Emerging Display and Hannstar Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Emerging Display 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.| Emerging Display vs. Data International Co | Emerging Display vs. Fu Burg Industrial | Emerging Display vs. Eagle Cold Storage | Emerging Display vs. Gigastorage Corp |
| Hannstar Display vs. AU Optronics | Hannstar Display vs. Innolux Corp | Hannstar Display vs. Winbond Electronics Corp | Hannstar Display vs. Qisda 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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