Correlation Between Asmedia Technology and Koge Micro
Can any of the company-specific risk be diversified away by investing in both Asmedia Technology and Koge Micro 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 Koge Micro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asmedia Technology and Koge Micro Tech, you can compare the effects of market volatilities on Asmedia Technology and Koge Micro 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 Koge Micro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asmedia Technology and Koge Micro.
Diversification Opportunities for Asmedia Technology and Koge Micro
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Asmedia and Koge is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Asmedia Technology and Koge Micro Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koge Micro Tech 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 Koge Micro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koge Micro Tech has no effect on the direction of Asmedia Technology i.e., Asmedia Technology and Koge Micro go up and down completely randomly.
Pair Corralation between Asmedia Technology and Koge Micro
Assuming the 90 days trading horizon Asmedia Technology is expected to generate 2.07 times more return on investment than Koge Micro. However, Asmedia Technology is 2.07 times more volatile than Koge Micro Tech. It trades about 0.06 of its potential returns per unit of risk. Koge Micro Tech is currently generating about 0.01 per unit of risk. If you would invest 200,000 in Asmedia Technology on October 21, 2024 and sell it today you would earn a total of 4,500 from holding Asmedia Technology or generate 2.25% 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. Koge Micro Tech
Performance |
| Timeline |
| Asmedia Technology |
| Koge Micro Tech |
Asmedia Technology and Koge Micro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asmedia Technology and Koge Micro
The main advantage of trading using opposite Asmedia Technology and Koge Micro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asmedia Technology position performs unexpectedly, Koge Micro 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 Koge Micro will offset losses from the drop in Koge Micro's long position.| Asmedia Technology vs. Alchip Technologies | Asmedia Technology vs. Aspeed Technology | Asmedia Technology vs. Silergy Corp | Asmedia Technology vs. Global Unichip Corp |
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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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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