Correlation Between HannStar Board and Flexium Interconnect
Can any of the company-specific risk be diversified away by investing in both HannStar Board and Flexium Interconnect 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 HannStar Board and Flexium Interconnect into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HannStar Board Corp and Flexium Interconnect, you can compare the effects of market volatilities on HannStar Board and Flexium Interconnect 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 HannStar Board with a short position of Flexium Interconnect. Check out your portfolio center. Please also check ongoing floating volatility patterns of HannStar Board and Flexium Interconnect.
Diversification Opportunities for HannStar Board and Flexium Interconnect
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between HannStar and Flexium is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding HannStar Board Corp and Flexium Interconnect in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flexium Interconnect and HannStar Board 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 HannStar Board Corp are associated (or correlated) with Flexium Interconnect. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flexium Interconnect has no effect on the direction of HannStar Board i.e., HannStar Board and Flexium Interconnect go up and down completely randomly.
Pair Corralation between HannStar Board and Flexium Interconnect
Assuming the 90 days trading horizon HannStar Board Corp is expected to generate 1.3 times more return on investment than Flexium Interconnect. However, HannStar Board is 1.3 times more volatile than Flexium Interconnect. It trades about 0.06 of its potential returns per unit of risk. Flexium Interconnect is currently generating about -0.04 per unit of risk. If you would invest 3,525 in HannStar Board Corp on November 28, 2024 and sell it today you would earn a total of 2,125 from holding HannStar Board Corp or generate 60.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HannStar Board Corp vs. Flexium Interconnect
Performance |
| Timeline |
| HannStar Board Corp |
| Flexium Interconnect |
HannStar Board and Flexium Interconnect Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HannStar Board and Flexium Interconnect
The main advantage of trading using opposite HannStar Board and Flexium Interconnect positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HannStar Board position performs unexpectedly, Flexium Interconnect 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 Flexium Interconnect will offset losses from the drop in Flexium Interconnect's long position.| HannStar Board vs. Tripod Technology Corp | HannStar Board vs. Hannstar Display Corp | HannStar Board vs. Compeq Manufacturing Co | HannStar Board vs. Unimicron Technology Corp |
| Flexium Interconnect vs. Zhen Ding Technology | Flexium Interconnect vs. Catcher Technology Co | Flexium Interconnect vs. Unimicron Technology Corp | Flexium Interconnect vs. Career Technology MFG |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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