Correlation Between Taiwan Weighted and Ta Ya
Can any of the company-specific risk be diversified away by investing in both Taiwan Weighted and Ta Ya 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 Ta Ya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Taiwan Weighted and Ta Ya Electric, you can compare the effects of market volatilities on Taiwan Weighted and Ta Ya 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 Ta Ya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taiwan Weighted and Ta Ya.
Diversification Opportunities for Taiwan Weighted and Ta Ya
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Taiwan and 1609 is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Taiwan Weighted and Ta Ya Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ta Ya Electric 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 Ta Ya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ta Ya Electric has no effect on the direction of Taiwan Weighted i.e., Taiwan Weighted and Ta Ya go up and down completely randomly.
Pair Corralation between Taiwan Weighted and Ta Ya
Assuming the 90 days trading horizon Taiwan Weighted is expected to under-perform the Ta Ya. But the index apears to be less risky and, when comparing its historical volatility, Taiwan Weighted is 1.63 times less risky than Ta Ya. The index trades about -0.1 of its potential returns per unit of risk. The Ta Ya Electric is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 4,640 in Ta Ya Electric on August 26, 2024 and sell it today you would earn a total of 5.00 from holding Ta Ya Electric or generate 0.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Taiwan Weighted vs. Ta Ya Electric
Performance |
| Timeline |
Taiwan Weighted and Ta Ya Volatility Contrast
Predicted Return Density |
| Returns |
Taiwan Weighted
Pair trading matchups for Taiwan Weighted
Ta Ya Electric
Pair trading matchups for Ta Ya
Pair Trading with Taiwan Weighted and Ta Ya
The main advantage of trading using opposite Taiwan Weighted and Ta Ya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taiwan Weighted position performs unexpectedly, Ta Ya 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 Ta Ya will offset losses from the drop in Ta Ya's long position.| Taiwan Weighted vs. Ibase Gaming | Taiwan Weighted vs. Ching Feng Home | Taiwan Weighted vs. Jinan Acetate Chemical | Taiwan Weighted vs. Hsinli Chemical Industrial |
| Ta Ya vs. Sunny Friend Environmental | Ta Ya vs. TTET Union Corp | Ta Ya vs. ECOVE Environment Corp | Ta Ya vs. Yulon Finance 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Stocks Directory Find actively traded stocks across global markets | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |