Correlation Between Sunfar Computer and Asustek Computer
Can any of the company-specific risk be diversified away by investing in both Sunfar Computer and Asustek Computer 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 Sunfar Computer and Asustek Computer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sunfar Computer Co and Asustek Computer, you can compare the effects of market volatilities on Sunfar Computer and Asustek Computer 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 Sunfar Computer with a short position of Asustek Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunfar Computer and Asustek Computer.
Diversification Opportunities for Sunfar Computer and Asustek Computer
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sunfar and Asustek is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Sunfar Computer Co and Asustek Computer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asustek Computer and Sunfar Computer 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 Sunfar Computer Co are associated (or correlated) with Asustek Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asustek Computer has no effect on the direction of Sunfar Computer i.e., Sunfar Computer and Asustek Computer go up and down completely randomly.
Pair Corralation between Sunfar Computer and Asustek Computer
Assuming the 90 days trading horizon Sunfar Computer is expected to generate 16.89 times less return on investment than Asustek Computer. But when comparing it to its historical volatility, Sunfar Computer Co is 3.01 times less risky than Asustek Computer. It trades about 0.02 of its potential returns per unit of risk. Asustek Computer is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 53,900 in Asustek Computer on September 12, 2024 and sell it today you would earn a total of 6,500 from holding Asustek Computer or generate 12.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunfar Computer Co vs. Asustek Computer
Performance |
| Timeline |
| Sunfar Computer |
| Asustek Computer |
Sunfar Computer and Asustek Computer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunfar Computer and Asustek Computer
The main advantage of trading using opposite Sunfar Computer and Asustek Computer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunfar Computer position performs unexpectedly, Asustek Computer 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 Asustek Computer will offset losses from the drop in Asustek Computer's long position.| Sunfar Computer vs. Auras Technology Co | Sunfar Computer vs. Forcecon Technology Co | Sunfar Computer vs. TUL Corporation | Sunfar Computer vs. Space Shuttle Hi Tech |
| Asustek Computer vs. AU Optronics | Asustek Computer vs. Innolux Corp | Asustek Computer vs. Ruentex Development Co | Asustek Computer vs. WiseChip Semiconductor |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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