Correlation Between Aspeed Technology and Prince Housing
Can any of the company-specific risk be diversified away by investing in both Aspeed Technology and Prince Housing 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 Aspeed Technology and Prince Housing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aspeed Technology and Prince Housing Development, you can compare the effects of market volatilities on Aspeed Technology and Prince Housing 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 Aspeed Technology with a short position of Prince Housing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aspeed Technology and Prince Housing.
Diversification Opportunities for Aspeed Technology and Prince Housing
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aspeed and Prince is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Aspeed Technology and Prince Housing Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prince Housing Devel and Aspeed 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 Aspeed Technology are associated (or correlated) with Prince Housing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prince Housing Devel has no effect on the direction of Aspeed Technology i.e., Aspeed Technology and Prince Housing go up and down completely randomly.
Pair Corralation between Aspeed Technology and Prince Housing
Assuming the 90 days trading horizon Aspeed Technology is expected to generate 2.22 times more return on investment than Prince Housing. However, Aspeed Technology is 2.22 times more volatile than Prince Housing Development. It trades about 0.04 of its potential returns per unit of risk. Prince Housing Development is currently generating about -0.05 per unit of risk. If you would invest 362,972 in Aspeed Technology on August 29, 2024 and sell it today you would earn a total of 30,528 from holding Aspeed Technology or generate 8.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aspeed Technology vs. Prince Housing Development
Performance |
| Timeline |
| Aspeed Technology |
| Prince Housing Devel |
Aspeed Technology and Prince Housing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aspeed Technology and Prince Housing
The main advantage of trading using opposite Aspeed Technology and Prince Housing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aspeed Technology position performs unexpectedly, Prince Housing 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 Prince Housing will offset losses from the drop in Prince Housing's long position.| Aspeed Technology vs. Asmedia Technology | Aspeed Technology vs. Silergy Corp | Aspeed Technology vs. Parade Technologies | Aspeed Technology vs. Wiwynn Corp |
| Prince Housing vs. AVerMedia Technologies | Prince Housing vs. Far EasTone Telecommunications | Prince Housing vs. Tainet Communication System | Prince Housing vs. Eastern Media International |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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