Correlation Between Generalplus Technology and Holtek Semiconductor
Can any of the company-specific risk be diversified away by investing in both Generalplus Technology and Holtek Semiconductor 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 Generalplus Technology and Holtek Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Generalplus Technology and Holtek Semiconductor, you can compare the effects of market volatilities on Generalplus Technology and Holtek Semiconductor 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 Generalplus Technology with a short position of Holtek Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Generalplus Technology and Holtek Semiconductor.
Diversification Opportunities for Generalplus Technology and Holtek Semiconductor
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Generalplus and Holtek is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Generalplus Technology and Holtek Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holtek Semiconductor and Generalplus 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 Generalplus Technology are associated (or correlated) with Holtek Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holtek Semiconductor has no effect on the direction of Generalplus Technology i.e., Generalplus Technology and Holtek Semiconductor go up and down completely randomly.
Pair Corralation between Generalplus Technology and Holtek Semiconductor
Assuming the 90 days trading horizon Generalplus Technology is expected to generate 1.12 times more return on investment than Holtek Semiconductor. However, Generalplus Technology is 1.12 times more volatile than Holtek Semiconductor. It trades about 0.01 of its potential returns per unit of risk. Holtek Semiconductor is currently generating about -0.02 per unit of risk. If you would invest 4,850 in Generalplus Technology on September 4, 2024 and sell it today you would earn a total of 180.00 from holding Generalplus Technology or generate 3.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Generalplus Technology vs. Holtek Semiconductor
Performance |
| Timeline |
| Generalplus Technology |
| Holtek Semiconductor |
Generalplus Technology and Holtek Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Generalplus Technology and Holtek Semiconductor
The main advantage of trading using opposite Generalplus Technology and Holtek Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Generalplus Technology position performs unexpectedly, Holtek Semiconductor 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 Holtek Semiconductor will offset losses from the drop in Holtek Semiconductor's long position.| Generalplus Technology vs. Taiwan Semiconductor Manufacturing | Generalplus Technology vs. Yang Ming Marine | Generalplus Technology vs. AU Optronics | Generalplus Technology vs. Innolux Corp |
| Holtek Semiconductor vs. Taiwan Semiconductor Manufacturing | Holtek Semiconductor vs. Yang Ming Marine | Holtek Semiconductor vs. AU Optronics | Holtek Semiconductor vs. Innolux 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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