Correlation Between Global Unichip and Tong Hsing
Can any of the company-specific risk be diversified away by investing in both Global Unichip and Tong Hsing 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 Tong Hsing 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 Tong Hsing Electronic, you can compare the effects of market volatilities on Global Unichip and Tong Hsing 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 Tong Hsing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Unichip and Tong Hsing.
Diversification Opportunities for Global Unichip and Tong Hsing
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and Tong is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Global Unichip Corp and Tong Hsing Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tong Hsing Electronic 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 Tong Hsing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tong Hsing Electronic has no effect on the direction of Global Unichip i.e., Global Unichip and Tong Hsing go up and down completely randomly.
Pair Corralation between Global Unichip and Tong Hsing
Assuming the 90 days trading horizon Global Unichip Corp is expected to under-perform the Tong Hsing. In addition to that, Global Unichip is 1.6 times more volatile than Tong Hsing Electronic. It trades about -0.05 of its total potential returns per unit of risk. Tong Hsing Electronic is currently generating about -0.05 per unit of volatility. If you would invest 15,200 in Tong Hsing Electronic on September 3, 2024 and sell it today you would lose (2,300) from holding Tong Hsing Electronic or give up 15.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Unichip Corp vs. Tong Hsing Electronic
Performance |
| Timeline |
| Global Unichip Corp |
| Tong Hsing Electronic |
Global Unichip and Tong Hsing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Unichip and Tong Hsing
The main advantage of trading using opposite Global Unichip and Tong Hsing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Unichip position performs unexpectedly, Tong Hsing 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 Tong Hsing will offset losses from the drop in Tong Hsing's long position.| Global Unichip vs. Taiwan Semiconductor Manufacturing | Global Unichip vs. Yang Ming Marine | Global Unichip vs. ASE Industrial Holding | Global Unichip vs. AU Optronics |
| Tong Hsing vs. Kinsus Interconnect Technology | Tong Hsing vs. Unimicron Technology Corp | Tong Hsing vs. Nan Ya Printed | Tong Hsing vs. WIN Semiconductors |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |