Correlation Between EGalaxeMPIA Technology and Oriental Union
Can any of the company-specific risk be diversified away by investing in both EGalaxeMPIA Technology and Oriental Union 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 EGalaxeMPIA Technology and Oriental Union into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between eGalaxeMPIA Technology and Oriental Union Chemical, you can compare the effects of market volatilities on EGalaxeMPIA Technology and Oriental Union 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 EGalaxeMPIA Technology with a short position of Oriental Union. Check out your portfolio center. Please also check ongoing floating volatility patterns of EGalaxeMPIA Technology and Oriental Union.
Diversification Opportunities for EGalaxeMPIA Technology and Oriental Union
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between EGalaxeMPIA and Oriental is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding eGalaxeMPIA Technology and Oriental Union Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oriental Union Chemical and EGalaxeMPIA Technology 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 eGalaxeMPIA Technology are associated (or correlated) with Oriental Union. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oriental Union Chemical has no effect on the direction of EGalaxeMPIA Technology i.e., EGalaxeMPIA Technology and Oriental Union go up and down completely randomly.
Pair Corralation between EGalaxeMPIA Technology and Oriental Union
Assuming the 90 days trading horizon eGalaxeMPIA Technology is expected to under-perform the Oriental Union. But the stock apears to be less risky and, when comparing its historical volatility, eGalaxeMPIA Technology is 2.4 times less risky than Oriental Union. The stock trades about -0.36 of its potential returns per unit of risk. The Oriental Union Chemical is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,440 in Oriental Union Chemical on October 22, 2024 and sell it today you would earn a total of 50.00 from holding Oriental Union Chemical or generate 3.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
eGalaxeMPIA Technology vs. Oriental Union Chemical
Performance |
| Timeline |
| eGalaxeMPIA Technology |
| Oriental Union Chemical |
EGalaxeMPIA Technology and Oriental Union Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EGalaxeMPIA Technology and Oriental Union
The main advantage of trading using opposite EGalaxeMPIA Technology and Oriental Union positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EGalaxeMPIA Technology position performs unexpectedly, Oriental Union 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 Oriental Union will offset losses from the drop in Oriental Union's long position.| EGalaxeMPIA Technology vs. Chipbond Technology | EGalaxeMPIA Technology vs. Vanguard International Semiconductor | EGalaxeMPIA Technology vs. Macroblock | EGalaxeMPIA Technology vs. Holtek Semiconductor |
| Oriental Union vs. China Man Made Fiber | Oriental Union vs. Taiwan Styrene Monomer | Oriental Union vs. USI Corp | Oriental Union vs. China Petrochemical Development |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Transaction History View history of all your transactions and understand their impact on performance |