Correlation Between Asmedia Technology and Chi Sheng
Can any of the company-specific risk be diversified away by investing in both Asmedia Technology and Chi Sheng 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 Chi Sheng into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asmedia Technology and Chi Sheng Chemical, you can compare the effects of market volatilities on Asmedia Technology and Chi Sheng 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 Chi Sheng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asmedia Technology and Chi Sheng.
Diversification Opportunities for Asmedia Technology and Chi Sheng
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Asmedia and Chi is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Asmedia Technology and Chi Sheng Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chi Sheng Chemical 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 Chi Sheng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chi Sheng Chemical has no effect on the direction of Asmedia Technology i.e., Asmedia Technology and Chi Sheng go up and down completely randomly.
Pair Corralation between Asmedia Technology and Chi Sheng
Assuming the 90 days trading horizon Asmedia Technology is expected to generate 2.24 times more return on investment than Chi Sheng. However, Asmedia Technology is 2.24 times more volatile than Chi Sheng Chemical. It trades about 0.07 of its potential returns per unit of risk. Chi Sheng Chemical is currently generating about 0.01 per unit of risk. If you would invest 89,834 in Asmedia Technology on October 28, 2024 and sell it today you would earn a total of 117,166 from holding Asmedia Technology or generate 130.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Asmedia Technology vs. Chi Sheng Chemical
Performance |
| Timeline |
| Asmedia Technology |
| Chi Sheng Chemical |
Asmedia Technology and Chi Sheng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asmedia Technology and Chi Sheng
The main advantage of trading using opposite Asmedia Technology and Chi Sheng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asmedia Technology position performs unexpectedly, Chi Sheng 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 Chi Sheng will offset losses from the drop in Chi Sheng's long position.| Asmedia Technology vs. Alchip Technologies | Asmedia Technology vs. Aspeed Technology | Asmedia Technology vs. Silergy Corp | Asmedia Technology vs. Global Unichip Corp |
| Chi Sheng vs. Pegavision | Chi Sheng vs. StShine Optical Co | Chi Sheng vs. Bioteque | Chi Sheng vs. Medeon Biodesign |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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