Correlation Between Galaxy Software and Chicony Power
Can any of the company-specific risk be diversified away by investing in both Galaxy Software and Chicony Power 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 Galaxy Software and Chicony Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Galaxy Software Services and Chicony Power Technology, you can compare the effects of market volatilities on Galaxy Software and Chicony Power 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 Galaxy Software with a short position of Chicony Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Galaxy Software and Chicony Power.
Diversification Opportunities for Galaxy Software and Chicony Power
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Galaxy and Chicony is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Galaxy Software Services and Chicony Power Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chicony Power Technology and Galaxy Software 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 Galaxy Software Services are associated (or correlated) with Chicony Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chicony Power Technology has no effect on the direction of Galaxy Software i.e., Galaxy Software and Chicony Power go up and down completely randomly.
Pair Corralation between Galaxy Software and Chicony Power
Assuming the 90 days trading horizon Galaxy Software Services is expected to generate 18.32 times more return on investment than Chicony Power. However, Galaxy Software is 18.32 times more volatile than Chicony Power Technology. It trades about 0.05 of its potential returns per unit of risk. Chicony Power Technology is currently generating about 0.06 per unit of risk. If you would invest 4,965 in Galaxy Software Services on September 3, 2024 and sell it today you would earn a total of 6,985 from holding Galaxy Software Services or generate 140.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Galaxy Software Services vs. Chicony Power Technology
Performance |
| Timeline |
| Galaxy Software Services |
| Chicony Power Technology |
Galaxy Software and Chicony Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Galaxy Software and Chicony Power
The main advantage of trading using opposite Galaxy Software and Chicony Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Galaxy Software position performs unexpectedly, Chicony Power 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 Chicony Power will offset losses from the drop in Chicony Power's long position.| Galaxy Software vs. YuantaP shares Taiwan Mid Cap | Galaxy Software vs. YuantaP shares Taiwan Electronics | Galaxy Software vs. YuantaP shares Taiwan Top | Galaxy Software vs. Fubon MSCI Taiwan |
| Chicony Power vs. WiseChip Semiconductor | Chicony Power vs. Novatek Microelectronics Corp | Chicony Power vs. Leader Electronics | Chicony Power vs. Information Technology Total |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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