Correlation Between Koge Micro and New Asia
Can any of the company-specific risk be diversified away by investing in both Koge Micro and New Asia 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 Koge Micro and New Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koge Micro Tech and New Asia Construction, you can compare the effects of market volatilities on Koge Micro and New Asia 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 Koge Micro with a short position of New Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koge Micro and New Asia.
Diversification Opportunities for Koge Micro and New Asia
-0.9 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Koge and New is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding Koge Micro Tech and New Asia Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Asia Construction and Koge Micro 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 Koge Micro Tech are associated (or correlated) with New Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Asia Construction has no effect on the direction of Koge Micro i.e., Koge Micro and New Asia go up and down completely randomly.
Pair Corralation between Koge Micro and New Asia
Assuming the 90 days trading horizon Koge Micro Tech is expected to under-perform the New Asia. But the stock apears to be less risky and, when comparing its historical volatility, Koge Micro Tech is 1.69 times less risky than New Asia. The stock trades about -0.19 of its potential returns per unit of risk. The New Asia Construction is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,290 in New Asia Construction on September 13, 2024 and sell it today you would earn a total of 35.00 from holding New Asia Construction or generate 2.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koge Micro Tech vs. New Asia Construction
Performance |
| Timeline |
| Koge Micro Tech |
| New Asia Construction |
Koge Micro and New Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koge Micro and New Asia
The main advantage of trading using opposite Koge Micro and New Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koge Micro position performs unexpectedly, New Asia 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 New Asia will offset losses from the drop in New Asia's long position.| Koge Micro vs. Highlight Tech | Koge Micro vs. Ruentex Development Co | Koge Micro vs. WiseChip Semiconductor | Koge Micro vs. Novatek Microelectronics Corp |
| New Asia vs. Yang Ming Marine | New Asia vs. Wan Hai Lines | New Asia vs. U Ming Marine Transport | New Asia vs. Taiwan Navigation Co |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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