Correlation Between Amazing Microelectronic and Trade Van
Can any of the company-specific risk be diversified away by investing in both Amazing Microelectronic and Trade Van 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 Amazing Microelectronic and Trade Van into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amazing Microelectronic and Trade Van Information Services, you can compare the effects of market volatilities on Amazing Microelectronic and Trade Van 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 Amazing Microelectronic with a short position of Trade Van. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazing Microelectronic and Trade Van.
Diversification Opportunities for Amazing Microelectronic and Trade Van
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Amazing and Trade is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Amazing Microelectronic and Trade Van Information Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trade Van Information and Amazing Microelectronic 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 Amazing Microelectronic are associated (or correlated) with Trade Van. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trade Van Information has no effect on the direction of Amazing Microelectronic i.e., Amazing Microelectronic and Trade Van go up and down completely randomly.
Pair Corralation between Amazing Microelectronic and Trade Van
Assuming the 90 days trading horizon Amazing Microelectronic is expected to under-perform the Trade Van. In addition to that, Amazing Microelectronic is 1.14 times more volatile than Trade Van Information Services. It trades about -0.21 of its total potential returns per unit of risk. Trade Van Information Services is currently generating about 0.32 per unit of volatility. If you would invest 8,360 in Trade Van Information Services on October 24, 2024 and sell it today you would earn a total of 790.00 from holding Trade Van Information Services or generate 9.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amazing Microelectronic vs. Trade Van Information Services
Performance |
| Timeline |
| Amazing Microelectronic |
| Trade Van Information |
Amazing Microelectronic and Trade Van Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amazing Microelectronic and Trade Van
The main advantage of trading using opposite Amazing Microelectronic and Trade Van positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazing Microelectronic position performs unexpectedly, Trade Van 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 Trade Van will offset losses from the drop in Trade Van's long position.The idea behind Amazing Microelectronic and Trade Van Information Services pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Trade Van vs. Taiwan Sakura Corp | Trade Van vs. Charoen Pokphand Enterprise | Trade Van vs. Taiwan Cogeneration Corp | Trade Van vs. Taiwan Secom Co |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |