Correlation Between Wistron Corp and Wayi International
Can any of the company-specific risk be diversified away by investing in both Wistron Corp and Wayi International 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 Wistron Corp and Wayi International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wistron Corp and Wayi International Digital, you can compare the effects of market volatilities on Wistron Corp and Wayi International 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 Wistron Corp with a short position of Wayi International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wistron Corp and Wayi International.
Diversification Opportunities for Wistron Corp and Wayi International
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wistron and Wayi is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Wistron Corp and Wayi International Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wayi International and Wistron Corp 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 Wistron Corp are associated (or correlated) with Wayi International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wayi International has no effect on the direction of Wistron Corp i.e., Wistron Corp and Wayi International go up and down completely randomly.
Pair Corralation between Wistron Corp and Wayi International
Assuming the 90 days trading horizon Wistron Corp is expected to generate 4.89 times less return on investment than Wayi International. But when comparing it to its historical volatility, Wistron Corp is 1.89 times less risky than Wayi International. It trades about 0.1 of its potential returns per unit of risk. Wayi International Digital is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 15,150 in Wayi International Digital on October 22, 2024 and sell it today you would earn a total of 3,450 from holding Wayi International Digital or generate 22.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wistron Corp vs. Wayi International Digital
Performance |
| Timeline |
| Wistron Corp |
| Wayi International |
Wistron Corp and Wayi International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wistron Corp and Wayi International
The main advantage of trading using opposite Wistron Corp and Wayi International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wistron Corp position performs unexpectedly, Wayi International 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 Wayi International will offset losses from the drop in Wayi International's long position.| Wistron Corp vs. Pegatron Corp | Wistron Corp vs. Quanta Computer | Wistron Corp vs. Compal Electronics | Wistron Corp vs. Inventec Corp |
| Wayi International vs. Johnson Health Tech | Wayi International vs. De Licacy Industrial | Wayi International vs. Phytohealth Corp | Wayi International vs. MedFirst Healthcare Services |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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