Correlation Between Acbel Polytech and Innolux Corp
Can any of the company-specific risk be diversified away by investing in both Acbel Polytech and Innolux Corp 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 Innolux Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acbel Polytech and Innolux Corp, you can compare the effects of market volatilities on Acbel Polytech and Innolux Corp 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 Innolux Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acbel Polytech and Innolux Corp.
Diversification Opportunities for Acbel Polytech and Innolux Corp
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Acbel and Innolux is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Acbel Polytech and Innolux Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innolux Corp 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 Innolux Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innolux Corp has no effect on the direction of Acbel Polytech i.e., Acbel Polytech and Innolux Corp go up and down completely randomly.
Pair Corralation between Acbel Polytech and Innolux Corp
Assuming the 90 days trading horizon Acbel Polytech is expected to generate 1.49 times less return on investment than Innolux Corp. In addition to that, Acbel Polytech is 1.07 times more volatile than Innolux Corp. It trades about 0.02 of its total potential returns per unit of risk. Innolux Corp is currently generating about 0.04 per unit of volatility. If you would invest 1,153 in Innolux Corp on August 29, 2024 and sell it today you would earn a total of 357.00 from holding Innolux Corp or generate 30.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Acbel Polytech vs. Innolux Corp
Performance |
| Timeline |
| Acbel Polytech |
| Innolux Corp |
Acbel Polytech and Innolux Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acbel Polytech and Innolux Corp
The main advantage of trading using opposite Acbel Polytech and Innolux Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acbel Polytech position performs unexpectedly, Innolux Corp 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 Innolux Corp will offset losses from the drop in Innolux Corp's long position.| Acbel Polytech vs. Yulon Motor Co | Acbel Polytech vs. Far Eastern Department | Acbel Polytech vs. China Steel Corp | Acbel Polytech vs. Chang Hwa Commercial |
| Innolux Corp vs. Sitronix Technology Corp | Innolux Corp vs. Elan Microelectronics Corp | Innolux Corp vs. Global Unichip Corp | Innolux Corp vs. Holtek 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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