Correlation Between Holtek Semiconductor and Greatek Electronics
Can any of the company-specific risk be diversified away by investing in both Holtek Semiconductor and Greatek Electronics 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 Holtek Semiconductor and Greatek Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Holtek Semiconductor and Greatek Electronics, you can compare the effects of market volatilities on Holtek Semiconductor and Greatek Electronics 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 Holtek Semiconductor with a short position of Greatek Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Holtek Semiconductor and Greatek Electronics.
Diversification Opportunities for Holtek Semiconductor and Greatek Electronics
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Holtek and Greatek is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Holtek Semiconductor and Greatek Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greatek Electronics and Holtek Semiconductor 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 Holtek Semiconductor are associated (or correlated) with Greatek Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greatek Electronics has no effect on the direction of Holtek Semiconductor i.e., Holtek Semiconductor and Greatek Electronics go up and down completely randomly.
Pair Corralation between Holtek Semiconductor and Greatek Electronics
Assuming the 90 days trading horizon Holtek Semiconductor is expected to generate 1.1 times more return on investment than Greatek Electronics. However, Holtek Semiconductor is 1.1 times more volatile than Greatek Electronics. It trades about 0.95 of its potential returns per unit of risk. Greatek Electronics is currently generating about 0.3 per unit of risk. If you would invest 4,500 in Holtek Semiconductor on November 28, 2024 and sell it today you would earn a total of 780.00 from holding Holtek Semiconductor or generate 17.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Holtek Semiconductor vs. Greatek Electronics
Performance |
| Timeline |
| Holtek Semiconductor |
| Greatek Electronics |
Holtek Semiconductor and Greatek Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Holtek Semiconductor and Greatek Electronics
The main advantage of trading using opposite Holtek Semiconductor and Greatek Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Holtek Semiconductor position performs unexpectedly, Greatek Electronics 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 Greatek Electronics will offset losses from the drop in Greatek Electronics' long position.| Holtek Semiconductor vs. Novatek Microelectronics Corp | Holtek Semiconductor vs. Realtek Semiconductor Corp | Holtek Semiconductor vs. Nuvoton Technology Corp | Holtek Semiconductor vs. Global Unichip Corp |
| Greatek Electronics vs. King Yuan Electronics | Greatek Electronics vs. Powertech Technology | Greatek Electronics vs. Realtek Semiconductor Corp | Greatek Electronics vs. Elan Microelectronics 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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