Correlation Between Asmedia Technology and PlayNitride
Can any of the company-specific risk be diversified away by investing in both Asmedia Technology and PlayNitride 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 PlayNitride into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asmedia Technology and PlayNitride, you can compare the effects of market volatilities on Asmedia Technology and PlayNitride 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 PlayNitride. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asmedia Technology and PlayNitride.
Diversification Opportunities for Asmedia Technology and PlayNitride
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Asmedia and PlayNitride is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Asmedia Technology and PlayNitride in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PlayNitride 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 PlayNitride. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PlayNitride has no effect on the direction of Asmedia Technology i.e., Asmedia Technology and PlayNitride go up and down completely randomly.
Pair Corralation between Asmedia Technology and PlayNitride
Assuming the 90 days trading horizon Asmedia Technology is expected to under-perform the PlayNitride. But the stock apears to be less risky and, when comparing its historical volatility, Asmedia Technology is 1.35 times less risky than PlayNitride. The stock trades about -0.02 of its potential returns per unit of risk. The PlayNitride is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 7,450 in PlayNitride on September 2, 2024 and sell it today you would earn a total of 6,600 from holding PlayNitride or generate 88.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asmedia Technology vs. PlayNitride
Performance |
| Timeline |
| Asmedia Technology |
| PlayNitride |
Asmedia Technology and PlayNitride Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asmedia Technology and PlayNitride
The main advantage of trading using opposite Asmedia Technology and PlayNitride positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asmedia Technology position performs unexpectedly, PlayNitride 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 PlayNitride will offset losses from the drop in PlayNitride's long position.| Asmedia Technology vs. Alchip Technologies | Asmedia Technology vs. Aspeed Technology | Asmedia Technology vs. Silergy Corp | Asmedia Technology vs. Global Unichip Corp |
| PlayNitride vs. Taiwan Semiconductor Manufacturing | PlayNitride vs. Hon Hai Precision | PlayNitride vs. MediaTek | PlayNitride vs. Chunghwa Telecom Co |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |