Correlation Between Coretronic and Silicon Power
Can any of the company-specific risk be diversified away by investing in both Coretronic and Silicon Power 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 Coretronic and Silicon Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coretronic and Silicon Power Computer, you can compare the effects of market volatilities on Coretronic and Silicon Power 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 Coretronic with a short position of Silicon Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coretronic and Silicon Power.
Diversification Opportunities for Coretronic and Silicon Power
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Coretronic and Silicon is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Coretronic and Silicon Power Computer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silicon Power Computer and Coretronic 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 Coretronic are associated (or correlated) with Silicon Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silicon Power Computer has no effect on the direction of Coretronic i.e., Coretronic and Silicon Power go up and down completely randomly.
Pair Corralation between Coretronic and Silicon Power
Assuming the 90 days trading horizon Coretronic is expected to under-perform the Silicon Power. In addition to that, Coretronic is 1.47 times more volatile than Silicon Power Computer. It trades about -0.04 of its total potential returns per unit of risk. Silicon Power Computer is currently generating about 0.15 per unit of volatility. If you would invest 3,110 in Silicon Power Computer on August 30, 2024 and sell it today you would earn a total of 200.00 from holding Silicon Power Computer or generate 6.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coretronic vs. Silicon Power Computer
Performance |
| Timeline |
| Coretronic |
| Silicon Power Computer |
Coretronic and Silicon Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coretronic and Silicon Power
The main advantage of trading using opposite Coretronic and Silicon Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coretronic position performs unexpectedly, Silicon Power 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 Silicon Power will offset losses from the drop in Silicon Power's long position.| Coretronic vs. Qisda Corp | Coretronic vs. AU Optronics | Coretronic vs. Vanguard International Semiconductor | Coretronic vs. Lite On Technology Corp |
| Silicon Power vs. Qisda Corp | Silicon Power vs. Quanta Computer | Silicon Power vs. Coretronic | Silicon Power vs. Wistron Corp |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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