Correlation Between WinMate Communication and Advantech
Can any of the company-specific risk be diversified away by investing in both WinMate Communication and Advantech 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 WinMate Communication and Advantech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WinMate Communication INC and Advantech Co, you can compare the effects of market volatilities on WinMate Communication and Advantech 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 WinMate Communication with a short position of Advantech. Check out your portfolio center. Please also check ongoing floating volatility patterns of WinMate Communication and Advantech.
Diversification Opportunities for WinMate Communication and Advantech
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between WinMate and Advantech is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding WinMate Communication INC and Advantech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advantech and WinMate Communication 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 WinMate Communication INC are associated (or correlated) with Advantech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advantech has no effect on the direction of WinMate Communication i.e., WinMate Communication and Advantech go up and down completely randomly.
Pair Corralation between WinMate Communication and Advantech
Assuming the 90 days trading horizon WinMate Communication INC is expected to generate 0.99 times more return on investment than Advantech. However, WinMate Communication INC is 1.01 times less risky than Advantech. It trades about 0.1 of its potential returns per unit of risk. Advantech Co is currently generating about 0.0 per unit of risk. If you would invest 13,850 in WinMate Communication INC on August 29, 2024 and sell it today you would earn a total of 1,400 from holding WinMate Communication INC or generate 10.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WinMate Communication INC vs. Advantech Co
Performance |
| Timeline |
| WinMate Communication INC |
| Advantech |
WinMate Communication and Advantech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WinMate Communication and Advantech
The main advantage of trading using opposite WinMate Communication and Advantech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WinMate Communication position performs unexpectedly, Advantech 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 Advantech will offset losses from the drop in Advantech's long position.| WinMate Communication vs. Hon Hai Precision | WinMate Communication vs. Delta Electronics | WinMate Communication vs. LARGAN Precision Co | WinMate Communication vs. E Ink Holdings |
| Advantech vs. Delta Electronics | Advantech vs. Quanta Computer | Advantech vs. Realtek Semiconductor Corp | Advantech vs. President Chain Store |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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