Correlation Between Amkor Technology and Chunghwa Telecom
Can any of the company-specific risk be diversified away by investing in both Amkor Technology and Chunghwa Telecom 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 Amkor Technology and Chunghwa Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amkor Technology and Chunghwa Telecom Co, you can compare the effects of market volatilities on Amkor Technology and Chunghwa Telecom 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 Amkor Technology with a short position of Chunghwa Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amkor Technology and Chunghwa Telecom.
Diversification Opportunities for Amkor Technology and Chunghwa Telecom
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Amkor and Chunghwa is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Amkor Technology and Chunghwa Telecom Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chunghwa Telecom and Amkor Technology 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 Amkor Technology are associated (or correlated) with Chunghwa Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chunghwa Telecom has no effect on the direction of Amkor Technology i.e., Amkor Technology and Chunghwa Telecom go up and down completely randomly.
Pair Corralation between Amkor Technology and Chunghwa Telecom
Given the investment horizon of 90 days Amkor Technology is expected to under-perform the Chunghwa Telecom. In addition to that, Amkor Technology is 1.93 times more volatile than Chunghwa Telecom Co. It trades about -0.05 of its total potential returns per unit of risk. Chunghwa Telecom Co is currently generating about 0.06 per unit of volatility. If you would invest 3,782 in Chunghwa Telecom Co on August 31, 2024 and sell it today you would earn a total of 51.00 from holding Chunghwa Telecom Co or generate 1.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amkor Technology vs. Chunghwa Telecom Co
Performance |
| Timeline |
| Amkor Technology |
| Chunghwa Telecom |
Amkor Technology and Chunghwa Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amkor Technology and Chunghwa Telecom
The main advantage of trading using opposite Amkor Technology and Chunghwa Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amkor Technology position performs unexpectedly, Chunghwa Telecom 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 Chunghwa Telecom will offset losses from the drop in Chunghwa Telecom's long position.| Amkor Technology vs. Power Integrations | Amkor Technology vs. Diodes Incorporated | Amkor Technology vs. MACOM Technology Solutions | Amkor Technology vs. Cirrus Logic |
| Chunghwa Telecom vs. RLJ Lodging Trust | Chunghwa Telecom vs. Aquagold International | Chunghwa Telecom vs. Stepstone Group | Chunghwa Telecom vs. Morningstar Unconstrained Allocation |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |