Correlation Between Taiwan Taomee and Fitipower Integrated
Can any of the company-specific risk be diversified away by investing in both Taiwan Taomee and Fitipower Integrated 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 Taiwan Taomee and Fitipower Integrated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Taiwan Taomee Co and Fitipower Integrated Technology, you can compare the effects of market volatilities on Taiwan Taomee and Fitipower Integrated 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 Taiwan Taomee with a short position of Fitipower Integrated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taiwan Taomee and Fitipower Integrated.
Diversification Opportunities for Taiwan Taomee and Fitipower Integrated
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Taiwan and Fitipower is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Taiwan Taomee Co and Fitipower Integrated Technolog in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fitipower Integrated and Taiwan Taomee 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 Taiwan Taomee Co are associated (or correlated) with Fitipower Integrated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fitipower Integrated has no effect on the direction of Taiwan Taomee i.e., Taiwan Taomee and Fitipower Integrated go up and down completely randomly.
Pair Corralation between Taiwan Taomee and Fitipower Integrated
Assuming the 90 days trading horizon Taiwan Taomee Co is expected to generate 1.17 times more return on investment than Fitipower Integrated. However, Taiwan Taomee is 1.17 times more volatile than Fitipower Integrated Technology. It trades about 0.01 of its potential returns per unit of risk. Fitipower Integrated Technology is currently generating about -0.01 per unit of risk. If you would invest 1,100 in Taiwan Taomee Co on September 2, 2024 and sell it today you would lose (35.00) from holding Taiwan Taomee Co or give up 3.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Taiwan Taomee Co vs. Fitipower Integrated Technolog
Performance |
| Timeline |
| Taiwan Taomee |
| Fitipower Integrated |
Taiwan Taomee and Fitipower Integrated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Taiwan Taomee and Fitipower Integrated
The main advantage of trading using opposite Taiwan Taomee and Fitipower Integrated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taiwan Taomee position performs unexpectedly, Fitipower Integrated 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 Fitipower Integrated will offset losses from the drop in Fitipower Integrated's long position.| Taiwan Taomee vs. Thermaltake Technology Co | Taiwan Taomee vs. Century Iron And | Taiwan Taomee vs. Sunspring Metal Corp | Taiwan Taomee vs. Air Asia Co |
| Fitipower Integrated vs. Taiwan Semiconductor Manufacturing | Fitipower Integrated vs. MediaTek | Fitipower Integrated vs. United Microelectronics | Fitipower Integrated 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 Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Stocks Directory Find actively traded stocks across global markets |