Correlation Between Jabil Circuit and United Microelectronics
Can any of the company-specific risk be diversified away by investing in both Jabil Circuit and United Microelectronics 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 Jabil Circuit and United Microelectronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jabil Circuit and United Microelectronics, you can compare the effects of market volatilities on Jabil Circuit and United Microelectronics 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 Jabil Circuit with a short position of United Microelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jabil Circuit and United Microelectronics.
Diversification Opportunities for Jabil Circuit and United Microelectronics
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Jabil and United is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Jabil Circuit and United Microelectronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Microelectronics and Jabil Circuit 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 Jabil Circuit are associated (or correlated) with United Microelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Microelectronics has no effect on the direction of Jabil Circuit i.e., Jabil Circuit and United Microelectronics go up and down completely randomly.
Pair Corralation between Jabil Circuit and United Microelectronics
Considering the 90-day investment horizon Jabil Circuit is expected to generate 1.21 times more return on investment than United Microelectronics. However, Jabil Circuit is 1.21 times more volatile than United Microelectronics. It trades about 0.07 of its potential returns per unit of risk. United Microelectronics is currently generating about 0.02 per unit of risk. If you would invest 6,854 in Jabil Circuit on September 14, 2024 and sell it today you would earn a total of 6,588 from holding Jabil Circuit or generate 96.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jabil Circuit vs. United Microelectronics
Performance |
| Timeline |
| Jabil Circuit |
| United Microelectronics |
Jabil Circuit and United Microelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jabil Circuit and United Microelectronics
The main advantage of trading using opposite Jabil Circuit and United Microelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jabil Circuit position performs unexpectedly, United Microelectronics 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 United Microelectronics will offset losses from the drop in United Microelectronics' long position.| Jabil Circuit vs. Sanmina | Jabil Circuit vs. Celestica | Jabil Circuit vs. Plexus Corp | Jabil Circuit vs. Fabrinet |
| United Microelectronics vs. Silicon Motion Technology | United Microelectronics vs. ASE Industrial Holding | United Microelectronics vs. ChipMOS Technologies | United Microelectronics vs. SemiLEDS |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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