Correlation Between ReWalk Robotics and United Microelectronics
Can any of the company-specific risk be diversified away by investing in both ReWalk Robotics 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 ReWalk Robotics and United Microelectronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ReWalk Robotics and United Microelectronics, you can compare the effects of market volatilities on ReWalk Robotics 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 ReWalk Robotics with a short position of United Microelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of ReWalk Robotics and United Microelectronics.
Diversification Opportunities for ReWalk Robotics and United Microelectronics
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ReWalk and United is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding ReWalk Robotics and United Microelectronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Microelectronics and ReWalk Robotics 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 ReWalk Robotics 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 ReWalk Robotics i.e., ReWalk Robotics and United Microelectronics go up and down completely randomly.
Pair Corralation between ReWalk Robotics and United Microelectronics
Given the investment horizon of 90 days ReWalk Robotics is expected to under-perform the United Microelectronics. In addition to that, ReWalk Robotics is 2.21 times more volatile than United Microelectronics. It trades about -0.04 of its total potential returns per unit of risk. United Microelectronics is currently generating about 0.02 per unit of volatility. If you would invest 581.00 in United Microelectronics on September 26, 2024 and sell it today you would earn a total of 92.00 from holding United Microelectronics or generate 15.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ReWalk Robotics vs. United Microelectronics
Performance |
| Timeline |
| ReWalk Robotics |
| United Microelectronics |
ReWalk Robotics and United Microelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ReWalk Robotics and United Microelectronics
The main advantage of trading using opposite ReWalk Robotics and United Microelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ReWalk Robotics 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.| ReWalk Robotics vs. United Microelectronics | ReWalk Robotics vs. Eldorado Gold Corp | ReWalk Robotics vs. Celestica | ReWalk Robotics vs. Cementos Pacasmayo SAA |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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