Correlation Between Macroblock and Holtek Semiconductor
Can any of the company-specific risk be diversified away by investing in both Macroblock and Holtek Semiconductor 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 Macroblock and Holtek Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macroblock and Holtek Semiconductor, you can compare the effects of market volatilities on Macroblock and Holtek Semiconductor 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 Macroblock with a short position of Holtek Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macroblock and Holtek Semiconductor.
Diversification Opportunities for Macroblock and Holtek Semiconductor
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Macroblock and Holtek is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Macroblock and Holtek Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holtek Semiconductor and Macroblock 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 Macroblock are associated (or correlated) with Holtek Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holtek Semiconductor has no effect on the direction of Macroblock i.e., Macroblock and Holtek Semiconductor go up and down completely randomly.
Pair Corralation between Macroblock and Holtek Semiconductor
Assuming the 90 days trading horizon Macroblock is expected to under-perform the Holtek Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Macroblock is 1.24 times less risky than Holtek Semiconductor. The stock trades about -0.11 of its potential returns per unit of risk. The Holtek Semiconductor is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 6,540 in Holtek Semiconductor on September 4, 2024 and sell it today you would lose (1,470) from holding Holtek Semiconductor or give up 22.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Macroblock vs. Holtek Semiconductor
Performance |
| Timeline |
| Macroblock |
| Holtek Semiconductor |
Macroblock and Holtek Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macroblock and Holtek Semiconductor
The main advantage of trading using opposite Macroblock and Holtek Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macroblock position performs unexpectedly, Holtek Semiconductor 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 Holtek Semiconductor will offset losses from the drop in Holtek Semiconductor's long position.| Macroblock vs. Newretail Co | Macroblock vs. Chunghwa Telecom Co | Macroblock vs. Tait Marketing Distribution | Macroblock vs. Tai Tung Communication |
| Holtek Semiconductor vs. Taiwan Semiconductor Manufacturing | Holtek Semiconductor vs. Yang Ming Marine | Holtek Semiconductor vs. AU Optronics | Holtek Semiconductor vs. Innolux 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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