Correlation Between Taiwan Weighted and Eva Airways
Can any of the company-specific risk be diversified away by investing in both Taiwan Weighted and Eva Airways 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 Eva Airways into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Taiwan Weighted and Eva Airways Corp, you can compare the effects of market volatilities on Taiwan Weighted and Eva Airways 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 Eva Airways. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taiwan Weighted and Eva Airways.
Diversification Opportunities for Taiwan Weighted and Eva Airways
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Taiwan and Eva is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Taiwan Weighted and Eva Airways Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eva Airways Corp 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 Eva Airways. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eva Airways Corp has no effect on the direction of Taiwan Weighted i.e., Taiwan Weighted and Eva Airways go up and down completely randomly.
Pair Corralation between Taiwan Weighted and Eva Airways
Assuming the 90 days trading horizon Taiwan Weighted is expected to generate 1.32 times less return on investment than Eva Airways. But when comparing it to its historical volatility, Taiwan Weighted is 1.77 times less risky than Eva Airways. It trades about 0.09 of its potential returns per unit of risk. Eva Airways Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,720 in Eva Airways Corp on August 30, 2024 and sell it today you would earn a total of 1,450 from holding Eva Airways Corp or generate 53.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.45% |
| Values | Daily Returns |
Taiwan Weighted vs. Eva Airways Corp
Performance |
| Timeline |
Taiwan Weighted and Eva Airways Volatility Contrast
Predicted Return Density |
| Returns |
Taiwan Weighted
Pair trading matchups for Taiwan Weighted
Eva Airways Corp
Pair trading matchups for Eva Airways
Pair Trading with Taiwan Weighted and Eva Airways
The main advantage of trading using opposite Taiwan Weighted and Eva Airways positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taiwan Weighted position performs unexpectedly, Eva Airways 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 Eva Airways will offset losses from the drop in Eva Airways' long position.| Taiwan Weighted vs. V Tac Technology Co | Taiwan Weighted vs. Sesoda Corp | Taiwan Weighted vs. Asmedia Technology | Taiwan Weighted vs. Oceanic Beverages Co |
| Eva Airways vs. Yulon Motor Co | Eva Airways vs. Far Eastern Department | Eva Airways vs. China Steel Corp | Eva Airways vs. Chang Hwa Commercial |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |