Correlation Between Adata Technology and Sitronix Technology
Can any of the company-specific risk be diversified away by investing in both Adata Technology and Sitronix 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 Adata Technology and Sitronix Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Adata Technology Co and Sitronix Technology Corp, you can compare the effects of market volatilities on Adata Technology and Sitronix 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 Adata Technology with a short position of Sitronix Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adata Technology and Sitronix Technology.
Diversification Opportunities for Adata Technology and Sitronix Technology
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Adata and Sitronix is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Adata Technology Co and Sitronix Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sitronix Technology Corp and Adata Technology 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 Adata Technology Co are associated (or correlated) with Sitronix Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sitronix Technology Corp has no effect on the direction of Adata Technology i.e., Adata Technology and Sitronix Technology go up and down completely randomly.
Pair Corralation between Adata Technology and Sitronix Technology
Assuming the 90 days trading horizon Adata Technology Co is expected to generate 1.15 times more return on investment than Sitronix Technology. However, Adata Technology is 1.15 times more volatile than Sitronix Technology Corp. It trades about 0.05 of its potential returns per unit of risk. Sitronix Technology Corp is currently generating about 0.03 per unit of risk. If you would invest 5,581 in Adata Technology Co on September 3, 2024 and sell it today you would earn a total of 3,139 from holding Adata Technology Co or generate 56.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Adata Technology Co vs. Sitronix Technology Corp
Performance |
| Timeline |
| Adata Technology |
| Sitronix Technology Corp |
Adata Technology and Sitronix Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adata Technology and Sitronix Technology
The main advantage of trading using opposite Adata Technology and Sitronix Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adata Technology position performs unexpectedly, Sitronix 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 Sitronix Technology will offset losses from the drop in Sitronix Technology's long position.| Adata Technology vs. Sitronix Technology Corp | Adata Technology vs. Kinsus Interconnect Technology | Adata Technology vs. WiseChip Semiconductor | Adata Technology vs. Novatek Microelectronics Corp |
| Sitronix Technology vs. Taiwan Semiconductor Manufacturing | Sitronix Technology vs. Yang Ming Marine | Sitronix Technology vs. ASE Industrial Holding | Sitronix Technology vs. AU Optronics |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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