Correlation Between Taiwan Weighted and Kung Long
Can any of the company-specific risk be diversified away by investing in both Taiwan Weighted and Kung Long 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 Taiwan Weighted and Kung Long into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Taiwan Weighted and Kung Long Batteries, you can compare the effects of market volatilities on Taiwan Weighted and Kung Long 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 Taiwan Weighted with a short position of Kung Long. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taiwan Weighted and Kung Long.
Diversification Opportunities for Taiwan Weighted and Kung Long
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Taiwan and Kung is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Taiwan Weighted and Kung Long Batteries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kung Long Batteries and Taiwan Weighted 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 Taiwan Weighted are associated (or correlated) with Kung Long. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kung Long Batteries has no effect on the direction of Taiwan Weighted i.e., Taiwan Weighted and Kung Long go up and down completely randomly.
Pair Corralation between Taiwan Weighted and Kung Long
Assuming the 90 days trading horizon Taiwan Weighted is expected to generate 1.11 times more return on investment than Kung Long. However, Taiwan Weighted is 1.11 times more volatile than Kung Long Batteries. It trades about 0.07 of its potential returns per unit of risk. Kung Long Batteries is currently generating about 0.04 per unit of risk. If you would invest 1,695,537 in Taiwan Weighted on September 2, 2024 and sell it today you would earn a total of 530,713 from holding Taiwan Weighted or generate 31.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.36% |
| Values | Daily Returns |
Taiwan Weighted vs. Kung Long Batteries
Performance |
| Timeline |
Taiwan Weighted and Kung Long Volatility Contrast
Predicted Return Density |
| Returns |
Taiwan Weighted
Pair trading matchups for Taiwan Weighted
Kung Long Batteries
Pair trading matchups for Kung Long
Pair Trading with Taiwan Weighted and Kung Long
The main advantage of trading using opposite Taiwan Weighted and Kung Long positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taiwan Weighted position performs unexpectedly, Kung Long 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 Kung Long will offset losses from the drop in Kung Long's long position.| Taiwan Weighted vs. Wei Chuan Foods | Taiwan Weighted vs. Sunny Friend Environmental | Taiwan Weighted vs. Mayer Steel Pipe | Taiwan Weighted vs. Standard Foods Corp |
| Kung Long vs. Grape King Bio | Kung Long vs. TTET Union Corp | Kung Long vs. Zeng Hsing Industrial | Kung Long vs. Basso Industry Corp |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |