Correlation Between Pili International and La Kaffa
Can any of the company-specific risk be diversified away by investing in both Pili International and La Kaffa 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 Pili International and La Kaffa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pili International Multimedia and La Kaffa International, you can compare the effects of market volatilities on Pili International and La Kaffa 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 Pili International with a short position of La Kaffa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pili International and La Kaffa.
Diversification Opportunities for Pili International and La Kaffa
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pili and 2732 is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Pili International Multimedia and La Kaffa International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on La Kaffa International and Pili International 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 Pili International Multimedia are associated (or correlated) with La Kaffa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of La Kaffa International has no effect on the direction of Pili International i.e., Pili International and La Kaffa go up and down completely randomly.
Pair Corralation between Pili International and La Kaffa
Assuming the 90 days trading horizon Pili International Multimedia is expected to under-perform the La Kaffa. But the stock apears to be less risky and, when comparing its historical volatility, Pili International Multimedia is 1.3 times less risky than La Kaffa. The stock trades about -0.01 of its potential returns per unit of risk. The La Kaffa International is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 11,325 in La Kaffa International on September 2, 2024 and sell it today you would lose (925.00) from holding La Kaffa International or give up 8.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pili International Multimedia vs. La Kaffa International
Performance |
| Timeline |
| Pili International |
| La Kaffa International |
Pili International and La Kaffa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pili International and La Kaffa
The main advantage of trading using opposite Pili International and La Kaffa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pili International position performs unexpectedly, La Kaffa 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 La Kaffa will offset losses from the drop in La Kaffa's long position.| Pili International vs. Deltamac Taiwan Co | Pili International vs. YuantaP shares Taiwan Top | Pili International vs. YuantaP shares Taiwan Electronics | Pili International vs. Fubon MSCI Taiwan |
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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