Correlation Between Logah Technology and Unimicron Technology
Can any of the company-specific risk be diversified away by investing in both Logah Technology and Unimicron 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 Logah Technology and Unimicron Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Logah Technology Corp and Unimicron Technology Corp, you can compare the effects of market volatilities on Logah Technology and Unimicron 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 Logah Technology with a short position of Unimicron Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Logah Technology and Unimicron Technology.
Diversification Opportunities for Logah Technology and Unimicron Technology
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Logah and Unimicron is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Logah Technology Corp and Unimicron Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unimicron Technology Corp and Logah 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 Logah Technology Corp are associated (or correlated) with Unimicron Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unimicron Technology Corp has no effect on the direction of Logah Technology i.e., Logah Technology and Unimicron Technology go up and down completely randomly.
Pair Corralation between Logah Technology and Unimicron Technology
Assuming the 90 days trading horizon Logah Technology Corp is expected to generate 2.07 times more return on investment than Unimicron Technology. However, Logah Technology is 2.07 times more volatile than Unimicron Technology Corp. It trades about 0.12 of its potential returns per unit of risk. Unimicron Technology Corp is currently generating about -0.32 per unit of risk. If you would invest 682.00 in Logah Technology Corp on November 5, 2024 and sell it today you would earn a total of 38.00 from holding Logah Technology Corp or generate 5.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Logah Technology Corp vs. Unimicron Technology Corp
Performance |
| Timeline |
| Logah Technology Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Unimicron Technology Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Logah Technology and Unimicron Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Logah Technology and Unimicron Technology
The main advantage of trading using opposite Logah Technology and Unimicron Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Logah Technology position performs unexpectedly, Unimicron 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 Unimicron Technology will offset losses from the drop in Unimicron Technology's long position.The idea behind Logah Technology Corp and Unimicron Technology Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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