Correlation Between Asia Metal and Hannstar Display
Can any of the company-specific risk be diversified away by investing in both Asia Metal and Hannstar Display 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 Asia Metal and Hannstar Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asia Metal Industries and Hannstar Display Corp, you can compare the effects of market volatilities on Asia Metal and Hannstar Display 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 Asia Metal with a short position of Hannstar Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Metal and Hannstar Display.
Diversification Opportunities for Asia Metal and Hannstar Display
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Asia and Hannstar is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Asia Metal Industries and Hannstar Display Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hannstar Display Corp and Asia Metal 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 Asia Metal Industries are associated (or correlated) with Hannstar Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hannstar Display Corp has no effect on the direction of Asia Metal i.e., Asia Metal and Hannstar Display go up and down completely randomly.
Pair Corralation between Asia Metal and Hannstar Display
Assuming the 90 days trading horizon Asia Metal Industries is expected to under-perform the Hannstar Display. But the stock apears to be less risky and, when comparing its historical volatility, Asia Metal Industries is 1.01 times less risky than Hannstar Display. The stock trades about -0.23 of its potential returns per unit of risk. The Hannstar Display Corp is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 808.00 in Hannstar Display Corp on October 24, 2024 and sell it today you would lose (6.00) from holding Hannstar Display Corp or give up 0.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia Metal Industries vs. Hannstar Display Corp
Performance |
| Timeline |
| Asia Metal Industries |
| Hannstar Display Corp |
Asia Metal and Hannstar Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia Metal and Hannstar Display
The main advantage of trading using opposite Asia Metal and Hannstar Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Metal position performs unexpectedly, Hannstar Display 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 Hannstar Display will offset losses from the drop in Hannstar Display's long position.| Asia Metal vs. RiTdisplay Corp | Asia Metal vs. Farglory FTZ Investment | Asia Metal vs. Wonderful Hi Tech Co | Asia Metal vs. Silicon Power Computer |
| Hannstar Display vs. AU Optronics | Hannstar Display vs. Innolux Corp | Hannstar Display vs. Winbond Electronics Corp | Hannstar Display vs. Qisda Corp |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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