Correlation Between Ibase Gaming and Taiwan Weighted
Can any of the company-specific risk be diversified away by investing in both Ibase Gaming and Taiwan Weighted 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 Ibase Gaming and Taiwan Weighted into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ibase Gaming and Taiwan Weighted, you can compare the effects of market volatilities on Ibase Gaming and Taiwan Weighted 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 Ibase Gaming with a short position of Taiwan Weighted. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ibase Gaming and Taiwan Weighted.
Diversification Opportunities for Ibase Gaming and Taiwan Weighted
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ibase and Taiwan is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Ibase Gaming and Taiwan Weighted in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taiwan Weighted and Ibase Gaming 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 Ibase Gaming are associated (or correlated) with Taiwan Weighted. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taiwan Weighted has no effect on the direction of Ibase Gaming i.e., Ibase Gaming and Taiwan Weighted go up and down completely randomly.
Pair Corralation between Ibase Gaming and Taiwan Weighted
Assuming the 90 days trading horizon Ibase Gaming is expected to under-perform the Taiwan Weighted. In addition to that, Ibase Gaming is 2.7 times more volatile than Taiwan Weighted. It trades about -0.14 of its total potential returns per unit of risk. Taiwan Weighted is currently generating about -0.06 per unit of volatility. If you would invest 2,319,252 in Taiwan Weighted on August 25, 2024 and sell it today you would lose (28,820) from holding Taiwan Weighted or give up 1.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Ibase Gaming vs. Taiwan Weighted
Performance |
| Timeline |
Ibase Gaming and Taiwan Weighted Volatility Contrast
Predicted Return Density |
| Returns |
Ibase Gaming
Pair trading matchups for Ibase Gaming
Taiwan Weighted
Pair trading matchups for Taiwan Weighted
Pair Trading with Ibase Gaming and Taiwan Weighted
The main advantage of trading using opposite Ibase Gaming and Taiwan Weighted positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ibase Gaming position performs unexpectedly, Taiwan Weighted 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 Taiwan Weighted will offset losses from the drop in Taiwan Weighted's long position.| Ibase Gaming vs. Hi Lai Foods Co | Ibase Gaming vs. Wei Chuan Foods | Ibase Gaming vs. Everlight Chemical Industrial | Ibase Gaming vs. Chung Hwa Chemical |
| Taiwan Weighted vs. Ibase Gaming | Taiwan Weighted vs. Ching Feng Home | Taiwan Weighted vs. Jinan Acetate Chemical | Taiwan Weighted vs. Hsinli Chemical Industrial |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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