Correlation Between AP Memory and Orient Semiconductor
Can any of the company-specific risk be diversified away by investing in both AP Memory and Orient Semiconductor 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 AP Memory and Orient Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AP Memory Technology and Orient Semiconductor Electronics, you can compare the effects of market volatilities on AP Memory and Orient Semiconductor 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 AP Memory with a short position of Orient Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of AP Memory and Orient Semiconductor.
Diversification Opportunities for AP Memory and Orient Semiconductor
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 6531 and Orient is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding AP Memory Technology and Orient Semiconductor Electroni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orient Semiconductor and AP Memory 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 AP Memory Technology are associated (or correlated) with Orient Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orient Semiconductor has no effect on the direction of AP Memory i.e., AP Memory and Orient Semiconductor go up and down completely randomly.
Pair Corralation between AP Memory and Orient Semiconductor
Assuming the 90 days trading horizon AP Memory is expected to generate 4.21 times less return on investment than Orient Semiconductor. But when comparing it to its historical volatility, AP Memory Technology is 1.09 times less risky than Orient Semiconductor. It trades about 0.01 of its potential returns per unit of risk. Orient Semiconductor Electronics is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,985 in Orient Semiconductor Electronics on December 4, 2024 and sell it today you would earn a total of 1,575 from holding Orient Semiconductor Electronics or generate 79.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AP Memory Technology vs. Orient Semiconductor Electroni
Performance |
| Timeline |
| AP Memory Technology |
| Orient Semiconductor |
AP Memory and Orient Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AP Memory and Orient Semiconductor
The main advantage of trading using opposite AP Memory and Orient Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AP Memory position performs unexpectedly, Orient Semiconductor 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 Orient Semiconductor will offset losses from the drop in Orient Semiconductor's long position.| AP Memory vs. Global Unichip Corp | AP Memory vs. Alchip Technologies | AP Memory vs. FocalTech Systems Co | AP Memory vs. Asmedia Technology |
| Orient Semiconductor vs. Macronix International Co | Orient Semiconductor vs. Silicon Integrated Systems | Orient Semiconductor vs. Winbond Electronics Corp | Orient Semiconductor vs. Mosel Vitelic |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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