Correlation Between PChome Online and Yieh United
Can any of the company-specific risk be diversified away by investing in both PChome Online and Yieh United 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 PChome Online and Yieh United into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PChome Online and Yieh United Steel, you can compare the effects of market volatilities on PChome Online and Yieh United 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 PChome Online with a short position of Yieh United. Check out your portfolio center. Please also check ongoing floating volatility patterns of PChome Online and Yieh United.
Diversification Opportunities for PChome Online and Yieh United
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PChome and Yieh is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding PChome Online and Yieh United Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yieh United Steel and PChome Online 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 PChome Online are associated (or correlated) with Yieh United. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yieh United Steel has no effect on the direction of PChome Online i.e., PChome Online and Yieh United go up and down completely randomly.
Pair Corralation between PChome Online and Yieh United
Assuming the 90 days trading horizon PChome Online is expected to generate 1.6 times more return on investment than Yieh United. However, PChome Online is 1.6 times more volatile than Yieh United Steel. It trades about 0.01 of its potential returns per unit of risk. Yieh United Steel is currently generating about -0.02 per unit of risk. If you would invest 5,352 in PChome Online on September 3, 2024 and sell it today you would lose (172.00) from holding PChome Online or give up 3.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PChome Online vs. Yieh United Steel
Performance |
| Timeline |
| PChome Online |
| Yieh United Steel |
PChome Online and Yieh United Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PChome Online and Yieh United
The main advantage of trading using opposite PChome Online and Yieh United positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PChome Online position performs unexpectedly, Yieh United 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 Yieh United will offset losses from the drop in Yieh United's long position.| PChome Online vs. President Chain Store | PChome Online vs. Uni President Enterprises Corp | PChome Online vs. Taiwan FamilyMart Co | PChome Online vs. Eclat Textile Co |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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