Correlation Between I Jang and AVerMedia Technologies
Can any of the company-specific risk be diversified away by investing in both I Jang and AVerMedia Technologies 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 I Jang and AVerMedia Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between I Jang Industrial and AVerMedia Technologies, you can compare the effects of market volatilities on I Jang and AVerMedia Technologies 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 I Jang with a short position of AVerMedia Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of I Jang and AVerMedia Technologies.
Diversification Opportunities for I Jang and AVerMedia Technologies
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 8342 and AVerMedia is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding I Jang Industrial and AVerMedia Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AVerMedia Technologies and I Jang 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 I Jang Industrial are associated (or correlated) with AVerMedia Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AVerMedia Technologies has no effect on the direction of I Jang i.e., I Jang and AVerMedia Technologies go up and down completely randomly.
Pair Corralation between I Jang and AVerMedia Technologies
Assuming the 90 days trading horizon I Jang is expected to generate 1.5 times less return on investment than AVerMedia Technologies. But when comparing it to its historical volatility, I Jang Industrial is 1.61 times less risky than AVerMedia Technologies. It trades about 0.07 of its potential returns per unit of risk. AVerMedia Technologies is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2,360 in AVerMedia Technologies on October 30, 2024 and sell it today you would earn a total of 2,450 from holding AVerMedia Technologies or generate 103.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
I Jang Industrial vs. AVerMedia Technologies
Performance |
| Timeline |
| I Jang Industrial |
| AVerMedia Technologies |
I Jang and AVerMedia Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with I Jang and AVerMedia Technologies
The main advantage of trading using opposite I Jang and AVerMedia Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if I Jang position performs unexpectedly, AVerMedia Technologies 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 AVerMedia Technologies will offset losses from the drop in AVerMedia Technologies' long position.| I Jang vs. AVerMedia Technologies | I Jang vs. Min Aik Technology | I Jang vs. Uniform Industrial Corp | I Jang vs. Leatec Fine Ceramics |
| AVerMedia Technologies vs. Tong Yang Industry | AVerMedia Technologies vs. Ta Yih Industrial | AVerMedia Technologies vs. Basso Industry Corp | AVerMedia Technologies vs. China Motor 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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