Correlation Between Intech Biopharm and Wafer Works
Can any of the company-specific risk be diversified away by investing in both Intech Biopharm and Wafer Works 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 Intech Biopharm and Wafer Works into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intech Biopharm and Wafer Works, you can compare the effects of market volatilities on Intech Biopharm and Wafer Works 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 Intech Biopharm with a short position of Wafer Works. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intech Biopharm and Wafer Works.
Diversification Opportunities for Intech Biopharm and Wafer Works
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Intech and Wafer is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Intech Biopharm and Wafer Works in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wafer Works and Intech Biopharm 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 Intech Biopharm are associated (or correlated) with Wafer Works. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wafer Works has no effect on the direction of Intech Biopharm i.e., Intech Biopharm and Wafer Works go up and down completely randomly.
Pair Corralation between Intech Biopharm and Wafer Works
Assuming the 90 days trading horizon Intech Biopharm is expected to generate 1.54 times more return on investment than Wafer Works. However, Intech Biopharm is 1.54 times more volatile than Wafer Works. It trades about -0.01 of its potential returns per unit of risk. Wafer Works is currently generating about -0.03 per unit of risk. If you would invest 3,410 in Intech Biopharm on August 30, 2024 and sell it today you would lose (715.00) from holding Intech Biopharm or give up 20.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intech Biopharm vs. Wafer Works
Performance |
| Timeline |
| Intech Biopharm |
| Wafer Works |
Intech Biopharm and Wafer Works Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intech Biopharm and Wafer Works
The main advantage of trading using opposite Intech Biopharm and Wafer Works positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intech Biopharm position performs unexpectedly, Wafer Works 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 Wafer Works will offset losses from the drop in Wafer Works' long position.| Intech Biopharm vs. ALFORMER Industrial Co | Intech Biopharm vs. Yeou Yih Steel | Intech Biopharm vs. Feng Hsin Steel | Intech Biopharm vs. Iron Force Industrial |
| Wafer Works vs. Sino American Silicon Products | Wafer Works vs. GlobalWafers Co | Wafer Works vs. Motech Industries Co | Wafer Works vs. Formosa Sumco Technology |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |