Correlation Between Wafer Works and INPAQ Technology
Can any of the company-specific risk be diversified away by investing in both Wafer Works and INPAQ Technology 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 Wafer Works and INPAQ Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wafer Works and INPAQ Technology Co, you can compare the effects of market volatilities on Wafer Works and INPAQ Technology 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 Wafer Works with a short position of INPAQ Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wafer Works and INPAQ Technology.
Diversification Opportunities for Wafer Works and INPAQ Technology
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Wafer and INPAQ is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Wafer Works and INPAQ Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INPAQ Technology and Wafer Works 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 Wafer Works are associated (or correlated) with INPAQ Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INPAQ Technology has no effect on the direction of Wafer Works i.e., Wafer Works and INPAQ Technology go up and down completely randomly.
Pair Corralation between Wafer Works and INPAQ Technology
Assuming the 90 days trading horizon Wafer Works is expected to under-perform the INPAQ Technology. But the stock apears to be less risky and, when comparing its historical volatility, Wafer Works is 1.33 times less risky than INPAQ Technology. The stock trades about -0.06 of its potential returns per unit of risk. The INPAQ Technology Co is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 5,432 in INPAQ Technology Co on November 28, 2024 and sell it today you would earn a total of 2,918 from holding INPAQ Technology Co or generate 53.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.78% |
| Values | Daily Returns |
Wafer Works vs. INPAQ Technology Co
Performance |
| Timeline |
| Wafer Works |
| INPAQ Technology |
Wafer Works and INPAQ Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wafer Works and INPAQ Technology
The main advantage of trading using opposite Wafer Works and INPAQ Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wafer Works position performs unexpectedly, INPAQ Technology 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 INPAQ Technology will offset losses from the drop in INPAQ Technology's long position.| Wafer Works vs. Sino American Silicon Products | Wafer Works vs. GlobalWafers Co | Wafer Works vs. Motech Industries Co | Wafer Works vs. Formosa Sumco Technology |
| INPAQ Technology vs. Hon Hai Precision | INPAQ Technology vs. Delta Electronics | INPAQ Technology vs. LARGAN Precision Co | INPAQ Technology vs. E Ink Holdings |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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