Correlation Between Landis Taipei and Ibase Gaming
Can any of the company-specific risk be diversified away by investing in both Landis Taipei and Ibase Gaming 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 Landis Taipei and Ibase Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Landis Taipei Hotel and Ibase Gaming, you can compare the effects of market volatilities on Landis Taipei and Ibase Gaming 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 Landis Taipei with a short position of Ibase Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Landis Taipei and Ibase Gaming.
Diversification Opportunities for Landis Taipei and Ibase Gaming
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Landis and Ibase is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Landis Taipei Hotel and Ibase Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ibase Gaming and Landis Taipei 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 Landis Taipei Hotel are associated (or correlated) with Ibase Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ibase Gaming has no effect on the direction of Landis Taipei i.e., Landis Taipei and Ibase Gaming go up and down completely randomly.
Pair Corralation between Landis Taipei and Ibase Gaming
Assuming the 90 days trading horizon Landis Taipei Hotel is expected to generate 1.11 times more return on investment than Ibase Gaming. However, Landis Taipei is 1.11 times more volatile than Ibase Gaming. It trades about 0.01 of its potential returns per unit of risk. Ibase Gaming is currently generating about 0.0 per unit of risk. If you would invest 2,005 in Landis Taipei Hotel on September 2, 2024 and sell it today you would lose (205.00) from holding Landis Taipei Hotel or give up 10.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Landis Taipei Hotel vs. Ibase Gaming
Performance |
| Timeline |
| Landis Taipei Hotel |
| Ibase Gaming |
Landis Taipei and Ibase Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Landis Taipei and Ibase Gaming
The main advantage of trading using opposite Landis Taipei and Ibase Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Landis Taipei position performs unexpectedly, Ibase Gaming 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 Ibase Gaming will offset losses from the drop in Ibase Gaming's long position.| Landis Taipei vs. Tehmag Foods | Landis Taipei vs. TWOWAY Communications | Landis Taipei vs. BRIM Biotechnology | Landis Taipei vs. Lian Hwa Foods |
| Ibase Gaming vs. Landis Taipei Hotel | Ibase Gaming vs. PChome Online | Ibase Gaming vs. Chicony Power Technology | Ibase Gaming vs. Formosa International Hotels |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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