Correlation Between EGalaxeMPIA Technology and Sitronix Technology
Can any of the company-specific risk be diversified away by investing in both EGalaxeMPIA Technology and Sitronix Technology 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 Sitronix Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between eGalaxeMPIA Technology and Sitronix Technology Corp, you can compare the effects of market volatilities on EGalaxeMPIA Technology and Sitronix Technology 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 Sitronix Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of EGalaxeMPIA Technology and Sitronix Technology.
Diversification Opportunities for EGalaxeMPIA Technology and Sitronix Technology
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between EGalaxeMPIA and Sitronix is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding eGalaxeMPIA Technology and Sitronix Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sitronix Technology Corp 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 Sitronix Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sitronix Technology Corp has no effect on the direction of EGalaxeMPIA Technology i.e., EGalaxeMPIA Technology and Sitronix Technology go up and down completely randomly.
Pair Corralation between EGalaxeMPIA Technology and Sitronix Technology
Assuming the 90 days trading horizon eGalaxeMPIA Technology is expected to generate 0.57 times more return on investment than Sitronix Technology. However, eGalaxeMPIA Technology is 1.74 times less risky than Sitronix Technology. It trades about -0.11 of its potential returns per unit of risk. Sitronix Technology Corp is currently generating about -0.07 per unit of risk. If you would invest 6,170 in eGalaxeMPIA Technology on September 12, 2024 and sell it today you would lose (1,625) from holding eGalaxeMPIA Technology or give up 26.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
eGalaxeMPIA Technology vs. Sitronix Technology Corp
Performance |
| Timeline |
| eGalaxeMPIA Technology |
| Sitronix Technology Corp |
EGalaxeMPIA Technology and Sitronix Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EGalaxeMPIA Technology and Sitronix Technology
The main advantage of trading using opposite EGalaxeMPIA Technology and Sitronix Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EGalaxeMPIA Technology position performs unexpectedly, Sitronix Technology 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 Sitronix Technology will offset losses from the drop in Sitronix Technology's long position.| EGalaxeMPIA Technology vs. Chipbond Technology | EGalaxeMPIA Technology vs. Vanguard International Semiconductor | EGalaxeMPIA Technology vs. Macroblock | EGalaxeMPIA Technology vs. Holtek Semiconductor |
| Sitronix Technology vs. AU Optronics | Sitronix Technology vs. Innolux Corp | Sitronix Technology vs. Ruentex Development Co | Sitronix Technology vs. WiseChip 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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