Correlation Between Global Unichip and Dimension Computer
Can any of the company-specific risk be diversified away by investing in both Global Unichip and Dimension Computer 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 Dimension Computer 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 Dimension Computer Technology, you can compare the effects of market volatilities on Global Unichip and Dimension Computer 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 Dimension Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Unichip and Dimension Computer.
Diversification Opportunities for Global Unichip and Dimension Computer
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and Dimension is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Global Unichip Corp and Dimension Computer Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dimension Computer 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 Dimension Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dimension Computer has no effect on the direction of Global Unichip i.e., Global Unichip and Dimension Computer go up and down completely randomly.
Pair Corralation between Global Unichip and Dimension Computer
Assuming the 90 days trading horizon Global Unichip Corp is expected to under-perform the Dimension Computer. But the stock apears to be less risky and, when comparing its historical volatility, Global Unichip Corp is 1.01 times less risky than Dimension Computer. The stock trades about -0.02 of its potential returns per unit of risk. The Dimension Computer Technology is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,080 in Dimension Computer Technology on September 12, 2024 and sell it today you would earn a total of 820.00 from holding Dimension Computer Technology or generate 39.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Unichip Corp vs. Dimension Computer Technology
Performance |
| Timeline |
| Global Unichip Corp |
| Dimension Computer |
Global Unichip and Dimension Computer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Unichip and Dimension Computer
The main advantage of trading using opposite Global Unichip and Dimension Computer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Unichip position performs unexpectedly, Dimension Computer 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 Dimension Computer will offset losses from the drop in Dimension Computer's long position.| Global Unichip vs. AU Optronics | Global Unichip vs. Innolux Corp | Global Unichip vs. Ruentex Development Co | Global Unichip vs. WiseChip Semiconductor |
| Dimension Computer vs. Niching Industrial | Dimension Computer vs. Kworld Computer Co | Dimension Computer vs. Ruentex Development Co | Dimension Computer vs. Symtek Automation Asia |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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