Correlation Between Powertech Technology and Flexium Interconnect
Can any of the company-specific risk be diversified away by investing in both Powertech Technology and Flexium Interconnect 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 Powertech Technology and Flexium Interconnect into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Powertech Technology and Flexium Interconnect, you can compare the effects of market volatilities on Powertech Technology and Flexium Interconnect 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 Powertech Technology with a short position of Flexium Interconnect. Check out your portfolio center. Please also check ongoing floating volatility patterns of Powertech Technology and Flexium Interconnect.
Diversification Opportunities for Powertech Technology and Flexium Interconnect
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Powertech and Flexium is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Powertech Technology and Flexium Interconnect in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flexium Interconnect and Powertech Technology 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 Powertech Technology are associated (or correlated) with Flexium Interconnect. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flexium Interconnect has no effect on the direction of Powertech Technology i.e., Powertech Technology and Flexium Interconnect go up and down completely randomly.
Pair Corralation between Powertech Technology and Flexium Interconnect
Assuming the 90 days trading horizon Powertech Technology is expected to under-perform the Flexium Interconnect. In addition to that, Powertech Technology is 1.13 times more volatile than Flexium Interconnect. It trades about -0.21 of its total potential returns per unit of risk. Flexium Interconnect is currently generating about -0.14 per unit of volatility. If you would invest 6,730 in Flexium Interconnect on September 13, 2024 and sell it today you would lose (230.00) from holding Flexium Interconnect or give up 3.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Powertech Technology vs. Flexium Interconnect
Performance |
| Timeline |
| Powertech Technology |
| Flexium Interconnect |
Powertech Technology and Flexium Interconnect Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Powertech Technology and Flexium Interconnect
The main advantage of trading using opposite Powertech Technology and Flexium Interconnect positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Powertech Technology position performs unexpectedly, Flexium Interconnect 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 Flexium Interconnect will offset losses from the drop in Flexium Interconnect's long position.| Powertech Technology vs. AU Optronics | Powertech Technology vs. Innolux Corp | Powertech Technology vs. Ruentex Development Co | Powertech Technology vs. WiseChip Semiconductor |
| Flexium Interconnect vs. Zhen Ding Technology | Flexium Interconnect vs. Catcher Technology Co | Flexium Interconnect vs. Unimicron Technology Corp | Flexium Interconnect vs. Kinsus Interconnect Technology |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |