Correlation Between Global Unichip and Chroma ATE
Can any of the company-specific risk be diversified away by investing in both Global Unichip and Chroma ATE 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 Global Unichip and Chroma ATE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Unichip Corp and Chroma ATE, you can compare the effects of market volatilities on Global Unichip and Chroma ATE 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 Global Unichip with a short position of Chroma ATE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Unichip and Chroma ATE.
Diversification Opportunities for Global Unichip and Chroma ATE
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Global and Chroma is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Global Unichip Corp and Chroma ATE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chroma ATE and Global Unichip 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 Global Unichip Corp are associated (or correlated) with Chroma ATE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chroma ATE has no effect on the direction of Global Unichip i.e., Global Unichip and Chroma ATE go up and down completely randomly.
Pair Corralation between Global Unichip and Chroma ATE
Assuming the 90 days trading horizon Global Unichip Corp is expected to generate 0.99 times more return on investment than Chroma ATE. However, Global Unichip Corp is 1.01 times less risky than Chroma ATE. It trades about 0.1 of its potential returns per unit of risk. Chroma ATE is currently generating about 0.09 per unit of risk. If you would invest 110,000 in Global Unichip Corp on August 29, 2024 and sell it today you would earn a total of 12,000 from holding Global Unichip Corp or generate 10.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Unichip Corp vs. Chroma ATE
Performance |
| Timeline |
| Global Unichip Corp |
| Chroma ATE |
Global Unichip and Chroma ATE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Unichip and Chroma ATE
The main advantage of trading using opposite Global Unichip and Chroma ATE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Unichip position performs unexpectedly, Chroma ATE 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 Chroma ATE will offset losses from the drop in Chroma ATE's long position.| Global Unichip vs. Novatek Microelectronics Corp | Global Unichip vs. Sitronix Technology Corp | Global Unichip vs. Elan Microelectronics Corp | Global Unichip vs. Holtek Semiconductor |
| Chroma ATE vs. Novatek Microelectronics Corp | Chroma ATE vs. Sitronix Technology Corp | Chroma ATE vs. Elan Microelectronics Corp | Chroma ATE vs. Global Unichip 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |