Correlation Between Wistron Corp and Cal Comp
Can any of the company-specific risk be diversified away by investing in both Wistron Corp and Cal Comp 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 Cal Comp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wistron Corp and Cal Comp Electronics Public, you can compare the effects of market volatilities on Wistron Corp and Cal Comp 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 Cal Comp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wistron Corp and Cal Comp.
Diversification Opportunities for Wistron Corp and Cal Comp
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Wistron and Cal is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Wistron Corp and Cal Comp Electronics Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cal Comp Electronics 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 Cal Comp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cal Comp Electronics has no effect on the direction of Wistron Corp i.e., Wistron Corp and Cal Comp go up and down completely randomly.
Pair Corralation between Wistron Corp and Cal Comp
Assuming the 90 days trading horizon Wistron Corp is expected to under-perform the Cal Comp. But the stock apears to be less risky and, when comparing its historical volatility, Wistron Corp is 1.46 times less risky than Cal Comp. The stock trades about -0.03 of its potential returns per unit of risk. The Cal Comp Electronics Public is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 643.00 in Cal Comp Electronics Public on September 13, 2024 and sell it today you would earn a total of 139.00 from holding Cal Comp Electronics Public or generate 21.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wistron Corp vs. Cal Comp Electronics Public
Performance |
| Timeline |
| Wistron Corp |
| Cal Comp Electronics |
Wistron Corp and Cal Comp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wistron Corp and Cal Comp
The main advantage of trading using opposite Wistron Corp and Cal Comp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wistron Corp position performs unexpectedly, Cal Comp 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 Cal Comp will offset losses from the drop in Cal Comp's long position.| Wistron Corp vs. Pegatron Corp | Wistron Corp vs. Quanta Computer | Wistron Corp vs. Compal Electronics | Wistron Corp vs. Inventec Corp |
| Cal Comp vs. Ton Yi Industrial | Cal Comp vs. Chenming Mold Industrial | Cal Comp vs. Gigastorage Corp | Cal Comp vs. AV Tech 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |