Correlation Between WIN Semiconductors and Adata Technology
Can any of the company-specific risk be diversified away by investing in both WIN Semiconductors and Adata Technology 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 WIN Semiconductors and Adata Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WIN Semiconductors and Adata Technology Co, you can compare the effects of market volatilities on WIN Semiconductors and Adata Technology 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 WIN Semiconductors with a short position of Adata Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of WIN Semiconductors and Adata Technology.
Diversification Opportunities for WIN Semiconductors and Adata Technology
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between WIN and Adata is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding WIN Semiconductors and Adata Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adata Technology and WIN Semiconductors 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 WIN Semiconductors are associated (or correlated) with Adata Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adata Technology has no effect on the direction of WIN Semiconductors i.e., WIN Semiconductors and Adata Technology go up and down completely randomly.
Pair Corralation between WIN Semiconductors and Adata Technology
Assuming the 90 days trading horizon WIN Semiconductors is expected to under-perform the Adata Technology. But the stock apears to be less risky and, when comparing its historical volatility, WIN Semiconductors is 1.03 times less risky than Adata Technology. The stock trades about -0.2 of its potential returns per unit of risk. The Adata Technology Co is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 7,900 in Adata Technology Co on October 29, 2024 and sell it today you would lose (200.00) from holding Adata Technology Co or give up 2.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WIN Semiconductors vs. Adata Technology Co
Performance |
| Timeline |
| WIN Semiconductors |
| Adata Technology |
WIN Semiconductors and Adata Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WIN Semiconductors and Adata Technology
The main advantage of trading using opposite WIN Semiconductors and Adata Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WIN Semiconductors position performs unexpectedly, Adata Technology 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 Adata Technology will offset losses from the drop in Adata Technology's long position.| WIN Semiconductors vs. LARGAN Precision Co | WIN Semiconductors vs. GlobalWafers Co | WIN Semiconductors vs. Novatek Microelectronics Corp | WIN Semiconductors vs. Advanced Wireless Semiconductor |
| Adata Technology vs. WIN Semiconductors | Adata Technology vs. Visual Photonics Epitaxy | Adata Technology vs. GlobalWafers Co | Adata Technology vs. Unimicron 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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