Correlation Between Asmedia Technology and Universal Vision
Can any of the company-specific risk be diversified away by investing in both Asmedia Technology and Universal Vision 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 Asmedia Technology and Universal Vision into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asmedia Technology and Universal Vision Biotechnology, you can compare the effects of market volatilities on Asmedia Technology and Universal Vision 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 Asmedia Technology with a short position of Universal Vision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asmedia Technology and Universal Vision.
Diversification Opportunities for Asmedia Technology and Universal Vision
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Asmedia and Universal is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Asmedia Technology and Universal Vision Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Vision Bio and Asmedia 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 Asmedia Technology are associated (or correlated) with Universal Vision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Vision Bio has no effect on the direction of Asmedia Technology i.e., Asmedia Technology and Universal Vision go up and down completely randomly.
Pair Corralation between Asmedia Technology and Universal Vision
Assuming the 90 days trading horizon Asmedia Technology is expected to generate 1.76 times more return on investment than Universal Vision. However, Asmedia Technology is 1.76 times more volatile than Universal Vision Biotechnology. It trades about 0.25 of its potential returns per unit of risk. Universal Vision Biotechnology is currently generating about -0.1 per unit of risk. If you would invest 165,000 in Asmedia Technology on September 15, 2024 and sell it today you would earn a total of 27,500 from holding Asmedia Technology or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asmedia Technology vs. Universal Vision Biotechnology
Performance |
| Timeline |
| Asmedia Technology |
| Universal Vision Bio |
Asmedia Technology and Universal Vision Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asmedia Technology and Universal Vision
The main advantage of trading using opposite Asmedia Technology and Universal Vision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asmedia Technology position performs unexpectedly, Universal Vision 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 Universal Vision will offset losses from the drop in Universal Vision's long position.| Asmedia Technology vs. Alchip Technologies | Asmedia Technology vs. Aspeed Technology | Asmedia Technology vs. Silergy Corp | Asmedia Technology vs. Global Unichip Corp |
| Universal Vision vs. Tainet Communication System | Universal Vision vs. Asmedia Technology | Universal Vision vs. Mobiletron Electronics Co | Universal Vision vs. U Tech Media 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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