Correlation Between Taiflex Scientific and BenQ Materials
Can any of the company-specific risk be diversified away by investing in both Taiflex Scientific and BenQ Materials 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 Taiflex Scientific and BenQ Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Taiflex Scientific Co and BenQ Materials Corp, you can compare the effects of market volatilities on Taiflex Scientific and BenQ Materials 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 Taiflex Scientific with a short position of BenQ Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taiflex Scientific and BenQ Materials.
Diversification Opportunities for Taiflex Scientific and BenQ Materials
-0.89 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Taiflex and BenQ is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding Taiflex Scientific Co and BenQ Materials Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BenQ Materials Corp and Taiflex Scientific 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 Taiflex Scientific Co are associated (or correlated) with BenQ Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BenQ Materials Corp has no effect on the direction of Taiflex Scientific i.e., Taiflex Scientific and BenQ Materials go up and down completely randomly.
Pair Corralation between Taiflex Scientific and BenQ Materials
Assuming the 90 days trading horizon Taiflex Scientific Co is expected to under-perform the BenQ Materials. In addition to that, Taiflex Scientific is 1.52 times more volatile than BenQ Materials Corp. It trades about 0.0 of its total potential returns per unit of risk. BenQ Materials Corp is currently generating about 0.0 per unit of volatility. If you would invest 3,300 in BenQ Materials Corp on September 3, 2024 and sell it today you would lose (45.00) from holding BenQ Materials Corp or give up 1.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Taiflex Scientific Co vs. BenQ Materials Corp
Performance |
| Timeline |
| Taiflex Scientific |
| BenQ Materials Corp |
Taiflex Scientific and BenQ Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Taiflex Scientific and BenQ Materials
The main advantage of trading using opposite Taiflex Scientific and BenQ Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taiflex Scientific position performs unexpectedly, BenQ Materials 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 BenQ Materials will offset losses from the drop in BenQ Materials' long position.| Taiflex Scientific vs. Flexium Interconnect | Taiflex Scientific vs. Career Technology MFG | Taiflex Scientific vs. Powertech Technology | Taiflex Scientific vs. Elite Material Co |
| BenQ Materials vs. Taiwan Semiconductor Manufacturing | BenQ Materials vs. Yang Ming Marine | BenQ Materials vs. ASE Industrial Holding | BenQ Materials vs. AU Optronics |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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