Correlation Between Auden Techno and Orient Semiconductor
Can any of the company-specific risk be diversified away by investing in both Auden Techno and Orient Semiconductor 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 Auden Techno and Orient Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auden Techno and Orient Semiconductor Electronics, you can compare the effects of market volatilities on Auden Techno and Orient Semiconductor 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 Auden Techno with a short position of Orient Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auden Techno and Orient Semiconductor.
Diversification Opportunities for Auden Techno and Orient Semiconductor
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Auden and Orient is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Auden Techno and Orient Semiconductor Electroni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orient Semiconductor and Auden Techno 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 Auden Techno are associated (or correlated) with Orient Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orient Semiconductor has no effect on the direction of Auden Techno i.e., Auden Techno and Orient Semiconductor go up and down completely randomly.
Pair Corralation between Auden Techno and Orient Semiconductor
Assuming the 90 days trading horizon Auden Techno is expected to under-perform the Orient Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Auden Techno is 1.37 times less risky than Orient Semiconductor. The stock trades about -0.01 of its potential returns per unit of risk. The Orient Semiconductor Electronics is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,760 in Orient Semiconductor Electronics on September 13, 2024 and sell it today you would earn a total of 1,830 from holding Orient Semiconductor Electronics or generate 103.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Auden Techno vs. Orient Semiconductor Electroni
Performance |
| Timeline |
| Auden Techno |
| Orient Semiconductor |
Auden Techno and Orient Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auden Techno and Orient Semiconductor
The main advantage of trading using opposite Auden Techno and Orient Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auden Techno position performs unexpectedly, Orient Semiconductor 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 Orient Semiconductor will offset losses from the drop in Orient Semiconductor's long position.| Auden Techno vs. Gemtek Technology Co | Auden Techno vs. Ruentex Development Co | Auden Techno vs. WiseChip Semiconductor | Auden Techno vs. Novatek Microelectronics Corp |
| Orient Semiconductor vs. AU Optronics | Orient Semiconductor vs. Innolux Corp | Orient Semiconductor vs. Ruentex Development Co | Orient Semiconductor vs. WiseChip Semiconductor |
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 CEOs Directory module to screen CEOs from public companies around the world.
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