Correlation Between Holtek Semiconductor and Tong Hsing
Can any of the company-specific risk be diversified away by investing in both Holtek Semiconductor and Tong Hsing 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 Tong Hsing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Holtek Semiconductor and Tong Hsing Electronic, you can compare the effects of market volatilities on Holtek Semiconductor and Tong Hsing 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 Tong Hsing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Holtek Semiconductor and Tong Hsing.
Diversification Opportunities for Holtek Semiconductor and Tong Hsing
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Holtek and Tong is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Holtek Semiconductor and Tong Hsing Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tong Hsing Electronic 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 Tong Hsing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tong Hsing Electronic has no effect on the direction of Holtek Semiconductor i.e., Holtek Semiconductor and Tong Hsing go up and down completely randomly.
Pair Corralation between Holtek Semiconductor and Tong Hsing
Assuming the 90 days trading horizon Holtek Semiconductor is expected to generate 1.44 times more return on investment than Tong Hsing. However, Holtek Semiconductor is 1.44 times more volatile than Tong Hsing Electronic. It trades about 0.07 of its potential returns per unit of risk. Tong Hsing Electronic is currently generating about -0.01 per unit of risk. If you would invest 4,615 in Holtek Semiconductor on September 12, 2024 and sell it today you would earn a total of 395.00 from holding Holtek Semiconductor or generate 8.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Holtek Semiconductor vs. Tong Hsing Electronic
Performance |
| Timeline |
| Holtek Semiconductor |
| Tong Hsing Electronic |
Holtek Semiconductor and Tong Hsing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Holtek Semiconductor and Tong Hsing
The main advantage of trading using opposite Holtek Semiconductor and Tong Hsing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Holtek Semiconductor position performs unexpectedly, Tong Hsing 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 Tong Hsing will offset losses from the drop in Tong Hsing's long position.| Holtek Semiconductor vs. AU Optronics | Holtek Semiconductor vs. Innolux Corp | Holtek Semiconductor vs. Ruentex Development Co | Holtek Semiconductor vs. WiseChip Semiconductor |
| Tong Hsing vs. AU Optronics | Tong Hsing vs. Innolux Corp | Tong Hsing vs. Ruentex Development Co | Tong Hsing 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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