Correlation Between Yeou Yih and Chia Yi
Can any of the company-specific risk be diversified away by investing in both Yeou Yih and Chia Yi 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 Yeou Yih and Chia Yi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yeou Yih Steel and Chia Yi Steel, you can compare the effects of market volatilities on Yeou Yih and Chia Yi 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 Yeou Yih with a short position of Chia Yi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yeou Yih and Chia Yi.
Diversification Opportunities for Yeou Yih and Chia Yi
Very good diversification
The 3 months correlation between Yeou and Chia is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Yeou Yih Steel and Chia Yi Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chia Yi Steel and Yeou Yih 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 Yeou Yih Steel are associated (or correlated) with Chia Yi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chia Yi Steel has no effect on the direction of Yeou Yih i.e., Yeou Yih and Chia Yi go up and down completely randomly.
Pair Corralation between Yeou Yih and Chia Yi
Assuming the 90 days trading horizon Yeou Yih Steel is expected to generate 0.12 times more return on investment than Chia Yi. However, Yeou Yih Steel is 8.02 times less risky than Chia Yi. It trades about -0.11 of its potential returns per unit of risk. Chia Yi Steel is currently generating about -0.03 per unit of risk. If you would invest 1,560 in Yeou Yih Steel on August 30, 2024 and sell it today you would lose (25.00) from holding Yeou Yih Steel or give up 1.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yeou Yih Steel vs. Chia Yi Steel
Performance |
| Timeline |
| Yeou Yih Steel |
| Chia Yi Steel |
Yeou Yih and Chia Yi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yeou Yih and Chia Yi
The main advantage of trading using opposite Yeou Yih and Chia Yi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yeou Yih position performs unexpectedly, Chia Yi 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 Chia Yi will offset losses from the drop in Chia Yi's long position.| Yeou Yih vs. Landis Taipei Hotel | Yeou Yih vs. Energenesis Biomedical Co | Yeou Yih vs. Great China Metal | Yeou Yih vs. Arbor Technology |
| Chia Yi vs. Skardin Industrial | Chia Yi vs. Powertech Industrial Co | Chia Yi vs. Chain Chon Industrial | Chia Yi vs. Chialin Precision Industrial |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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