Correlation Between Sun Max and Quanta Computer
Can any of the company-specific risk be diversified away by investing in both Sun Max and Quanta Computer 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 Sun Max and Quanta Computer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sun Max Tech and Quanta Computer, you can compare the effects of market volatilities on Sun Max and Quanta Computer 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 Sun Max with a short position of Quanta Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Max and Quanta Computer.
Diversification Opportunities for Sun Max and Quanta Computer
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sun and Quanta is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Sun Max Tech and Quanta Computer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quanta Computer and Sun Max 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 Sun Max Tech are associated (or correlated) with Quanta Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quanta Computer has no effect on the direction of Sun Max i.e., Sun Max and Quanta Computer go up and down completely randomly.
Pair Corralation between Sun Max and Quanta Computer
Assuming the 90 days trading horizon Sun Max Tech is expected to generate 0.84 times more return on investment than Quanta Computer. However, Sun Max Tech is 1.19 times less risky than Quanta Computer. It trades about 0.04 of its potential returns per unit of risk. Quanta Computer is currently generating about -0.15 per unit of risk. If you would invest 5,180 in Sun Max Tech on August 29, 2024 and sell it today you would earn a total of 70.00 from holding Sun Max Tech or generate 1.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sun Max Tech vs. Quanta Computer
Performance |
| Timeline |
| Sun Max Tech |
| Quanta Computer |
Sun Max and Quanta Computer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Max and Quanta Computer
The main advantage of trading using opposite Sun Max and Quanta Computer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Max position performs unexpectedly, Quanta Computer 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 Quanta Computer will offset losses from the drop in Quanta Computer's long position.| Sun Max vs. ASRock Inc | Sun Max vs. Ko Ja Cayman | Sun Max vs. Chenbro Micom Co | Sun Max vs. Leadtek Research |
| Quanta Computer vs. Sitronix Technology Corp | Quanta Computer vs. Elan Microelectronics Corp | Quanta Computer vs. Holtek Semiconductor |
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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