Correlation Between HannsTouch Solution and Global Unichip
Can any of the company-specific risk be diversified away by investing in both HannsTouch Solution and Global Unichip 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 HannsTouch Solution and Global Unichip into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HannsTouch Solution and Global Unichip Corp, you can compare the effects of market volatilities on HannsTouch Solution and Global Unichip 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 HannsTouch Solution with a short position of Global Unichip. Check out your portfolio center. Please also check ongoing floating volatility patterns of HannsTouch Solution and Global Unichip.
Diversification Opportunities for HannsTouch Solution and Global Unichip
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between HannsTouch and Global is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding HannsTouch Solution and Global Unichip Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Unichip Corp and HannsTouch Solution 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 HannsTouch Solution are associated (or correlated) with Global Unichip. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Unichip Corp has no effect on the direction of HannsTouch Solution i.e., HannsTouch Solution and Global Unichip go up and down completely randomly.
Pair Corralation between HannsTouch Solution and Global Unichip
Assuming the 90 days trading horizon HannsTouch Solution is expected to under-perform the Global Unichip. But the stock apears to be less risky and, when comparing its historical volatility, HannsTouch Solution is 1.01 times less risky than Global Unichip. The stock trades about -0.06 of its potential returns per unit of risk. The Global Unichip Corp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 118,000 in Global Unichip Corp on September 2, 2024 and sell it today you would earn a total of 1,000.00 from holding Global Unichip Corp or generate 0.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HannsTouch Solution vs. Global Unichip Corp
Performance |
| Timeline |
| HannsTouch Solution |
| Global Unichip Corp |
HannsTouch Solution and Global Unichip Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HannsTouch Solution and Global Unichip
The main advantage of trading using opposite HannsTouch Solution and Global Unichip positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HannsTouch Solution position performs unexpectedly, Global Unichip 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 Global Unichip will offset losses from the drop in Global Unichip's long position.| HannsTouch Solution vs. Hannstar Display Corp | HannsTouch Solution vs. Amtran Technology Co | HannsTouch Solution vs. AU Optronics | HannsTouch Solution vs. Optimax Technology 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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