Correlation Between Excellence Optoelectronic and C Media
Can any of the company-specific risk be diversified away by investing in both Excellence Optoelectronic and C Media 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 Excellence Optoelectronic and C Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Excellence Optoelectronic and C Media Electronics, you can compare the effects of market volatilities on Excellence Optoelectronic and C Media 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 Excellence Optoelectronic with a short position of C Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Excellence Optoelectronic and C Media.
Diversification Opportunities for Excellence Optoelectronic and C Media
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Excellence and 6237 is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Excellence Optoelectronic and C Media Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on C Media Electronics and Excellence Optoelectronic 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 Excellence Optoelectronic are associated (or correlated) with C Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of C Media Electronics has no effect on the direction of Excellence Optoelectronic i.e., Excellence Optoelectronic and C Media go up and down completely randomly.
Pair Corralation between Excellence Optoelectronic and C Media
Assuming the 90 days trading horizon Excellence Optoelectronic is expected to generate 2.67 times more return on investment than C Media. However, Excellence Optoelectronic is 2.67 times more volatile than C Media Electronics. It trades about 0.05 of its potential returns per unit of risk. C Media Electronics is currently generating about -0.07 per unit of risk. If you would invest 2,915 in Excellence Optoelectronic on August 30, 2024 and sell it today you would earn a total of 80.00 from holding Excellence Optoelectronic or generate 2.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Excellence Optoelectronic vs. C Media Electronics
Performance |
| Timeline |
| Excellence Optoelectronic |
| C Media Electronics |
Excellence Optoelectronic and C Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Excellence Optoelectronic and C Media
The main advantage of trading using opposite Excellence Optoelectronic and C Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Excellence Optoelectronic position performs unexpectedly, C Media 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 C Media will offset losses from the drop in C Media's long position.| Excellence Optoelectronic vs. Hota Industrial Mfg | Excellence Optoelectronic vs. BizLink Holding | Excellence Optoelectronic vs. Tong Hsing Electronic | Excellence Optoelectronic vs. SDI Corp |
| C Media vs. Taiwan Semiconductor Manufacturing | C Media vs. MediaTek | C Media vs. United Microelectronics | C Media vs. Novatek 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |