Correlation Between Acbel Polytech and Cheng Uei
Can any of the company-specific risk be diversified away by investing in both Acbel Polytech and Cheng Uei 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 Acbel Polytech and Cheng Uei into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acbel Polytech and Cheng Uei Precision, you can compare the effects of market volatilities on Acbel Polytech and Cheng Uei 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 Acbel Polytech with a short position of Cheng Uei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acbel Polytech and Cheng Uei.
Diversification Opportunities for Acbel Polytech and Cheng Uei
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Acbel and Cheng is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Acbel Polytech and Cheng Uei Precision in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheng Uei Precision and Acbel Polytech 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 Acbel Polytech are associated (or correlated) with Cheng Uei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheng Uei Precision has no effect on the direction of Acbel Polytech i.e., Acbel Polytech and Cheng Uei go up and down completely randomly.
Pair Corralation between Acbel Polytech and Cheng Uei
Assuming the 90 days trading horizon Acbel Polytech is expected to generate 4.18 times less return on investment than Cheng Uei. In addition to that, Acbel Polytech is 1.02 times more volatile than Cheng Uei Precision. It trades about 0.02 of its total potential returns per unit of risk. Cheng Uei Precision is currently generating about 0.08 per unit of volatility. If you would invest 3,640 in Cheng Uei Precision on September 4, 2024 and sell it today you would earn a total of 4,140 from holding Cheng Uei Precision or generate 113.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Acbel Polytech vs. Cheng Uei Precision
Performance |
| Timeline |
| Acbel Polytech |
| Cheng Uei Precision |
Acbel Polytech and Cheng Uei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acbel Polytech and Cheng Uei
The main advantage of trading using opposite Acbel Polytech and Cheng Uei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acbel Polytech position performs unexpectedly, Cheng Uei 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 Cheng Uei will offset losses from the drop in Cheng Uei's long position.| Acbel Polytech vs. Universal Microelectronics Co | Acbel Polytech vs. AVerMedia Technologies | Acbel Polytech vs. Symtek Automation Asia | Acbel Polytech vs. WiseChip Semiconductor |
| Cheng Uei vs. Taiwan Semiconductor Manufacturing | Cheng Uei vs. Yang Ming Marine | Cheng Uei vs. AU Optronics | Cheng Uei vs. Innolux 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 CEOs Directory module to screen CEOs from public companies around the world.
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