Correlation Between ASE Industrial and Coxon Precise
Can any of the company-specific risk be diversified away by investing in both ASE Industrial and Coxon Precise 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 ASE Industrial and Coxon Precise into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASE Industrial Holding and Coxon Precise Industrial, you can compare the effects of market volatilities on ASE Industrial and Coxon Precise 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 ASE Industrial with a short position of Coxon Precise. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASE Industrial and Coxon Precise.
Diversification Opportunities for ASE Industrial and Coxon Precise
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ASE and Coxon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ASE Industrial Holding and Coxon Precise Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coxon Precise Industrial and ASE Industrial 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 ASE Industrial Holding are associated (or correlated) with Coxon Precise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coxon Precise Industrial has no effect on the direction of ASE Industrial i.e., ASE Industrial and Coxon Precise go up and down completely randomly.
Pair Corralation between ASE Industrial and Coxon Precise
Assuming the 90 days trading horizon ASE Industrial Holding is expected to generate 0.89 times more return on investment than Coxon Precise. However, ASE Industrial Holding is 1.12 times less risky than Coxon Precise. It trades about 0.05 of its potential returns per unit of risk. Coxon Precise Industrial is currently generating about 0.05 per unit of risk. If you would invest 9,630 in ASE Industrial Holding on September 3, 2024 and sell it today you would earn a total of 5,520 from holding ASE Industrial Holding or generate 57.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ASE Industrial Holding vs. Coxon Precise Industrial
Performance |
| Timeline |
| ASE Industrial Holding |
| Coxon Precise Industrial |
ASE Industrial and Coxon Precise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASE Industrial and Coxon Precise
The main advantage of trading using opposite ASE Industrial and Coxon Precise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASE Industrial position performs unexpectedly, Coxon Precise 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 Coxon Precise will offset losses from the drop in Coxon Precise's long position.| ASE Industrial vs. Delta Electronics | ASE Industrial vs. Novatek Microelectronics Corp | ASE Industrial vs. United Microelectronics | ASE Industrial vs. LARGAN Precision Co |
| Coxon Precise vs. Taiwan Semiconductor Manufacturing | Coxon Precise vs. Yang Ming Marine | Coxon Precise vs. ASE Industrial Holding | Coxon Precise vs. AU Optronics |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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