Correlation Between Chinese Gamer and YuantaP Shares
Can any of the company-specific risk be diversified away by investing in both Chinese Gamer and YuantaP Shares 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 Chinese Gamer and YuantaP Shares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chinese Gamer International and YuantaP shares Taiwan Electronics, you can compare the effects of market volatilities on Chinese Gamer and YuantaP Shares 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 Chinese Gamer with a short position of YuantaP Shares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chinese Gamer and YuantaP Shares.
Diversification Opportunities for Chinese Gamer and YuantaP Shares
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Chinese and YuantaP is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Chinese Gamer International and YuantaP shares Taiwan Electron in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YuantaP shares Taiwan and Chinese Gamer 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 Chinese Gamer International are associated (or correlated) with YuantaP Shares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YuantaP shares Taiwan has no effect on the direction of Chinese Gamer i.e., Chinese Gamer and YuantaP Shares go up and down completely randomly.
Pair Corralation between Chinese Gamer and YuantaP Shares
Assuming the 90 days trading horizon Chinese Gamer International is expected to generate 1.09 times more return on investment than YuantaP Shares. However, Chinese Gamer is 1.09 times more volatile than YuantaP shares Taiwan Electronics. It trades about 0.01 of its potential returns per unit of risk. YuantaP shares Taiwan Electronics is currently generating about -0.16 per unit of risk. If you would invest 4,510 in Chinese Gamer International on August 24, 2024 and sell it today you would earn a total of 0.00 from holding Chinese Gamer International or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chinese Gamer International vs. YuantaP shares Taiwan Electron
Performance |
| Timeline |
| Chinese Gamer Intern |
| YuantaP shares Taiwan |
Chinese Gamer and YuantaP Shares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chinese Gamer and YuantaP Shares
The main advantage of trading using opposite Chinese Gamer and YuantaP Shares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chinese Gamer position performs unexpectedly, YuantaP Shares 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 YuantaP Shares will offset losses from the drop in YuantaP Shares' long position.| Chinese Gamer vs. YuantaP shares Taiwan Electronics | Chinese Gamer vs. YuantaP shares Taiwan Mid Cap | Chinese Gamer vs. Fubon MSCI Taiwan | Chinese Gamer vs. YuantaP shares Taiwan Top |
| YuantaP Shares vs. YuantaP shares Taiwan Top | YuantaP Shares vs. YuantaP shares MSCI Taiwan | YuantaP Shares vs. YuantaP shares Taiwan GreTai | YuantaP Shares vs. YuantaP shares SSE50 |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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