Correlation Between Pegatron Corp and Aker Technology
Can any of the company-specific risk be diversified away by investing in both Pegatron Corp and Aker 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 Pegatron Corp and Aker Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pegatron Corp and Aker Technology Co, you can compare the effects of market volatilities on Pegatron Corp and Aker 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 Pegatron Corp with a short position of Aker Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pegatron Corp and Aker Technology.
Diversification Opportunities for Pegatron Corp and Aker Technology
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pegatron and Aker is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Pegatron Corp and Aker Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aker Technology and Pegatron Corp 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 Pegatron Corp are associated (or correlated) with Aker Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aker Technology has no effect on the direction of Pegatron Corp i.e., Pegatron Corp and Aker Technology go up and down completely randomly.
Pair Corralation between Pegatron Corp and Aker Technology
Assuming the 90 days trading horizon Pegatron Corp is expected to under-perform the Aker Technology. But the stock apears to be less risky and, when comparing its historical volatility, Pegatron Corp is 3.02 times less risky than Aker Technology. The stock trades about -0.14 of its potential returns per unit of risk. The Aker Technology Co is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 2,130 in Aker Technology Co on September 1, 2024 and sell it today you would earn a total of 610.00 from holding Aker Technology Co or generate 28.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pegatron Corp vs. Aker Technology Co
Performance |
| Timeline |
| Pegatron Corp |
| Aker Technology |
Pegatron Corp and Aker Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pegatron Corp and Aker Technology
The main advantage of trading using opposite Pegatron Corp and Aker Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pegatron Corp position performs unexpectedly, Aker 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 Aker Technology will offset losses from the drop in Aker Technology's long position.| Pegatron Corp vs. Wistron Corp | Pegatron Corp vs. Quanta Computer | Pegatron Corp vs. Compal Electronics | Pegatron Corp vs. Catcher Technology Co |
| Aker Technology vs. Hon Hai Precision | Aker Technology vs. Delta Electronics | Aker Technology vs. LARGAN Precision Co | Aker Technology vs. Yageo Corp |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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