Correlation Between AAEON Technology and Ta Ya
Can any of the company-specific risk be diversified away by investing in both AAEON Technology and Ta Ya 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 AAEON Technology and Ta Ya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AAEON Technology and Ta Ya Electric, you can compare the effects of market volatilities on AAEON Technology and Ta Ya 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 AAEON Technology with a short position of Ta Ya. Check out your portfolio center. Please also check ongoing floating volatility patterns of AAEON Technology and Ta Ya.
Diversification Opportunities for AAEON Technology and Ta Ya
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between AAEON and 1609 is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding AAEON Technology and Ta Ya Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ta Ya Electric and AAEON Technology 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 AAEON Technology are associated (or correlated) with Ta Ya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ta Ya Electric has no effect on the direction of AAEON Technology i.e., AAEON Technology and Ta Ya go up and down completely randomly.
Pair Corralation between AAEON Technology and Ta Ya
Assuming the 90 days trading horizon AAEON Technology is expected to under-perform the Ta Ya. In addition to that, AAEON Technology is 1.14 times more volatile than Ta Ya Electric. It trades about -0.12 of its total potential returns per unit of risk. Ta Ya Electric is currently generating about 0.04 per unit of volatility. If you would invest 4,530 in Ta Ya Electric on September 1, 2024 and sell it today you would earn a total of 55.00 from holding Ta Ya Electric or generate 1.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
AAEON Technology vs. Ta Ya Electric
Performance |
| Timeline |
| AAEON Technology |
| Ta Ya Electric |
AAEON Technology and Ta Ya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AAEON Technology and Ta Ya
The main advantage of trading using opposite AAEON Technology and Ta Ya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AAEON Technology position performs unexpectedly, Ta Ya 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 Ta Ya will offset losses from the drop in Ta Ya's long position.| AAEON Technology vs. Quanta Computer | AAEON Technology vs. Wiwynn Corp | AAEON Technology vs. Getac Technology Corp | AAEON Technology vs. InnoDisk |
| Ta Ya vs. BES Engineering Co | Ta Ya vs. Continental Holdings Corp | Ta Ya vs. Kee Tai Properties | Ta Ya vs. Hung Sheng Construction |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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