Correlation Between E Ink and Unique Optical
Can any of the company-specific risk be diversified away by investing in both E Ink and Unique Optical 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 E Ink and Unique Optical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between E Ink Holdings and Unique Optical Industrial, you can compare the effects of market volatilities on E Ink and Unique Optical 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 E Ink with a short position of Unique Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of E Ink and Unique Optical.
Diversification Opportunities for E Ink and Unique Optical
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 8069 and Unique is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding E Ink Holdings and Unique Optical Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unique Optical Industrial and E Ink 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 E Ink Holdings are associated (or correlated) with Unique Optical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unique Optical Industrial has no effect on the direction of E Ink i.e., E Ink and Unique Optical go up and down completely randomly.
Pair Corralation between E Ink and Unique Optical
Assuming the 90 days trading horizon E Ink Holdings is expected to generate 1.12 times more return on investment than Unique Optical. However, E Ink is 1.12 times more volatile than Unique Optical Industrial. It trades about 0.05 of its potential returns per unit of risk. Unique Optical Industrial is currently generating about -0.01 per unit of risk. If you would invest 20,760 in E Ink Holdings on August 31, 2024 and sell it today you would earn a total of 7,340 from holding E Ink Holdings or generate 35.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
E Ink Holdings vs. Unique Optical Industrial
Performance |
| Timeline |
| E Ink Holdings |
| Unique Optical Industrial |
E Ink and Unique Optical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with E Ink and Unique Optical
The main advantage of trading using opposite E Ink and Unique Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if E Ink position performs unexpectedly, Unique Optical 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 Unique Optical will offset losses from the drop in Unique Optical's long position.| E Ink vs. Hon Hai Precision | E Ink vs. Delta Electronics | E Ink vs. LARGAN Precision Co | E Ink vs. Yageo Corp |
| Unique Optical vs. Taisol Electronics Co | Unique Optical vs. Eternal Materials Co | Unique Optical vs. ABC Taiwan Electronics | Unique Optical vs. Asia Electronic Material |
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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