Correlation Between United Radiant and Posiflex Technology
Can any of the company-specific risk be diversified away by investing in both United Radiant and Posiflex Technology 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 United Radiant and Posiflex Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Radiant Technology and Posiflex Technology, you can compare the effects of market volatilities on United Radiant and Posiflex Technology 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 United Radiant with a short position of Posiflex Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Radiant and Posiflex Technology.
Diversification Opportunities for United Radiant and Posiflex Technology
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between United and Posiflex is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding United Radiant Technology and Posiflex Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Posiflex Technology and United Radiant 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 United Radiant Technology are associated (or correlated) with Posiflex Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Posiflex Technology has no effect on the direction of United Radiant i.e., United Radiant and Posiflex Technology go up and down completely randomly.
Pair Corralation between United Radiant and Posiflex Technology
Assuming the 90 days trading horizon United Radiant is expected to generate 3.2 times less return on investment than Posiflex Technology. But when comparing it to its historical volatility, United Radiant Technology is 1.45 times less risky than Posiflex Technology. It trades about 0.1 of its potential returns per unit of risk. Posiflex Technology is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 14,950 in Posiflex Technology on September 5, 2024 and sell it today you would earn a total of 17,150 from holding Posiflex Technology or generate 114.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Radiant Technology vs. Posiflex Technology
Performance |
| Timeline |
| United Radiant Technology |
| Posiflex Technology |
United Radiant and Posiflex Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Radiant and Posiflex Technology
The main advantage of trading using opposite United Radiant and Posiflex Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Radiant position performs unexpectedly, Posiflex Technology 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 Posiflex Technology will offset losses from the drop in Posiflex Technology's long position.| United Radiant vs. Hotel Holiday Garden | United Radiant vs. Standard Foods Corp | United Radiant vs. AVer Information | United Radiant vs. FarGlory Hotel Co |
| Posiflex Technology vs. Taiwan Semiconductor Manufacturing | Posiflex Technology vs. Yang Ming Marine | Posiflex Technology vs. AU Optronics | Posiflex Technology vs. Nan Ya Plastics |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Stocks Directory Find actively traded stocks across global markets | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |