Correlation Between WIN Semiconductors and Aspeed Technology
Can any of the company-specific risk be diversified away by investing in both WIN Semiconductors and Aspeed 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 Aspeed 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 Aspeed Technology, you can compare the effects of market volatilities on WIN Semiconductors and Aspeed 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 Aspeed Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of WIN Semiconductors and Aspeed Technology.
Diversification Opportunities for WIN Semiconductors and Aspeed Technology
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between WIN and Aspeed is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding WIN Semiconductors and Aspeed Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aspeed 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 Aspeed Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aspeed Technology has no effect on the direction of WIN Semiconductors i.e., WIN Semiconductors and Aspeed Technology go up and down completely randomly.
Pair Corralation between WIN Semiconductors and Aspeed Technology
Assuming the 90 days trading horizon WIN Semiconductors is expected to under-perform the Aspeed Technology. But the stock apears to be less risky and, when comparing its historical volatility, WIN Semiconductors is 1.35 times less risky than Aspeed Technology. The stock trades about -0.01 of its potential returns per unit of risk. The Aspeed Technology is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 190,916 in Aspeed Technology on September 3, 2024 and sell it today you would earn a total of 217,584 from holding Aspeed Technology or generate 113.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WIN Semiconductors vs. Aspeed Technology
Performance |
| Timeline |
| WIN Semiconductors |
| Aspeed Technology |
WIN Semiconductors and Aspeed Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WIN Semiconductors and Aspeed Technology
The main advantage of trading using opposite WIN Semiconductors and Aspeed Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WIN Semiconductors position performs unexpectedly, Aspeed 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 Aspeed Technology will offset losses from the drop in Aspeed Technology's long position.| WIN Semiconductors vs. Sitronix Technology Corp | WIN Semiconductors vs. Kinsus Interconnect Technology | WIN Semiconductors vs. WiseChip Semiconductor | WIN Semiconductors vs. Novatek Microelectronics Corp |
| Aspeed Technology vs. Asmedia Technology | Aspeed Technology vs. Silergy Corp | Aspeed Technology vs. Parade Technologies | Aspeed Technology vs. Wiwynn 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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