Correlation Between Giant Manufacturing and U Tech
Can any of the company-specific risk be diversified away by investing in both Giant Manufacturing and U Tech 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 Giant Manufacturing and U Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Giant Manufacturing Co and U Tech Media Corp, you can compare the effects of market volatilities on Giant Manufacturing and U Tech 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 Giant Manufacturing with a short position of U Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Giant Manufacturing and U Tech.
Diversification Opportunities for Giant Manufacturing and U Tech
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Giant and 3050 is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Giant Manufacturing Co and U Tech Media Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on U Tech Media and Giant Manufacturing 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 Giant Manufacturing Co are associated (or correlated) with U Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of U Tech Media has no effect on the direction of Giant Manufacturing i.e., Giant Manufacturing and U Tech go up and down completely randomly.
Pair Corralation between Giant Manufacturing and U Tech
Assuming the 90 days trading horizon Giant Manufacturing Co is expected to under-perform the U Tech. But the stock apears to be less risky and, when comparing its historical volatility, Giant Manufacturing Co is 1.28 times less risky than U Tech. The stock trades about -0.03 of its potential returns per unit of risk. The U Tech Media Corp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,550 in U Tech Media Corp on September 12, 2024 and sell it today you would earn a total of 275.00 from holding U Tech Media Corp or generate 17.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Giant Manufacturing Co vs. U Tech Media Corp
Performance |
| Timeline |
| Giant Manufacturing |
| U Tech Media |
Giant Manufacturing and U Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Giant Manufacturing and U Tech
The main advantage of trading using opposite Giant Manufacturing and U Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Giant Manufacturing position performs unexpectedly, U Tech 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 U Tech will offset losses from the drop in U Tech's long position.| Giant Manufacturing vs. Feng Tay Enterprises | Giant Manufacturing vs. Ruentex Development Co | Giant Manufacturing vs. WiseChip Semiconductor | Giant Manufacturing vs. Novatek Microelectronics Corp |
| U Tech vs. AU Optronics | U Tech vs. Innolux Corp | U Tech vs. Ruentex Development Co | U Tech vs. WiseChip Semiconductor |
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.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |