Correlation Between Deltamac Taiwan and Space Shuttle
Can any of the company-specific risk be diversified away by investing in both Deltamac Taiwan and Space Shuttle 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 Deltamac Taiwan and Space Shuttle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deltamac Taiwan Co and Space Shuttle Hi Tech, you can compare the effects of market volatilities on Deltamac Taiwan and Space Shuttle 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 Deltamac Taiwan with a short position of Space Shuttle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deltamac Taiwan and Space Shuttle.
Diversification Opportunities for Deltamac Taiwan and Space Shuttle
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Deltamac and Space is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Deltamac Taiwan Co and Space Shuttle Hi Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Space Shuttle Hi and Deltamac Taiwan 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 Deltamac Taiwan Co are associated (or correlated) with Space Shuttle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Space Shuttle Hi has no effect on the direction of Deltamac Taiwan i.e., Deltamac Taiwan and Space Shuttle go up and down completely randomly.
Pair Corralation between Deltamac Taiwan and Space Shuttle
Assuming the 90 days trading horizon Deltamac Taiwan Co is expected to under-perform the Space Shuttle. In addition to that, Deltamac Taiwan is 5.71 times more volatile than Space Shuttle Hi Tech. It trades about -0.03 of its total potential returns per unit of risk. Space Shuttle Hi Tech is currently generating about -0.18 per unit of volatility. If you would invest 1,265 in Space Shuttle Hi Tech on October 21, 2024 and sell it today you would lose (55.00) from holding Space Shuttle Hi Tech or give up 4.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Deltamac Taiwan Co vs. Space Shuttle Hi Tech
Performance |
| Timeline |
| Deltamac Taiwan |
| Space Shuttle Hi |
Deltamac Taiwan and Space Shuttle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deltamac Taiwan and Space Shuttle
The main advantage of trading using opposite Deltamac Taiwan and Space Shuttle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deltamac Taiwan position performs unexpectedly, Space Shuttle 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 Space Shuttle will offset losses from the drop in Space Shuttle's long position.| Deltamac Taiwan vs. Pili International Multimedia | Deltamac Taiwan vs. Taiwan Semiconductor Manufacturing | Deltamac Taiwan vs. CTBC Financial Holding | Deltamac Taiwan vs. Hota Industrial Mfg |
| Space Shuttle vs. Universal Microelectronics Co | Space Shuttle vs. Greatek Electronics | Space Shuttle vs. Phihong Technology Co | Space Shuttle vs. Zippy Technology 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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