Correlation Between Global Unichip and ASRock
Can any of the company-specific risk be diversified away by investing in both Global Unichip and ASRock 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 ASRock 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 ASRock Inc, you can compare the effects of market volatilities on Global Unichip and ASRock 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 ASRock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Unichip and ASRock.
Diversification Opportunities for Global Unichip and ASRock
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Global and ASRock is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Global Unichip Corp and ASRock Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASRock Inc 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 ASRock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASRock Inc has no effect on the direction of Global Unichip i.e., Global Unichip and ASRock go up and down completely randomly.
Pair Corralation between Global Unichip and ASRock
Assuming the 90 days trading horizon Global Unichip Corp is expected to under-perform the ASRock. But the stock apears to be less risky and, when comparing its historical volatility, Global Unichip Corp is 1.12 times less risky than ASRock. The stock trades about -0.08 of its potential returns per unit of risk. The ASRock Inc is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 20,900 in ASRock Inc on August 29, 2024 and sell it today you would earn a total of 2,700 from holding ASRock Inc or generate 12.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Unichip Corp vs. ASRock Inc
Performance |
| Timeline |
| Global Unichip Corp |
| ASRock Inc |
Global Unichip and ASRock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Unichip and ASRock
The main advantage of trading using opposite Global Unichip and ASRock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Unichip position performs unexpectedly, ASRock 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 ASRock will offset losses from the drop in ASRock's long position.| Global Unichip vs. Sitronix Technology Corp | Global Unichip vs. Elan Microelectronics Corp | Global Unichip vs. Holtek Semiconductor |
| ASRock vs. Sitronix Technology Corp | ASRock vs. Elan Microelectronics Corp | ASRock vs. Global Unichip Corp | ASRock vs. Holtek Semiconductor |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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