Correlation Between UMC Electronics and Jacquet Metal
Can any of the company-specific risk be diversified away by investing in both UMC Electronics and Jacquet Metal 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 UMC Electronics and Jacquet Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UMC Electronics Co and Jacquet Metal Service, you can compare the effects of market volatilities on UMC Electronics and Jacquet Metal 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 UMC Electronics with a short position of Jacquet Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of UMC Electronics and Jacquet Metal.
Diversification Opportunities for UMC Electronics and Jacquet Metal
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between UMC and Jacquet is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding UMC Electronics Co and Jacquet Metal Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jacquet Metal Service and UMC Electronics 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 UMC Electronics Co are associated (or correlated) with Jacquet Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jacquet Metal Service has no effect on the direction of UMC Electronics i.e., UMC Electronics and Jacquet Metal go up and down completely randomly.
Pair Corralation between UMC Electronics and Jacquet Metal
Assuming the 90 days horizon UMC Electronics Co is expected to under-perform the Jacquet Metal. In addition to that, UMC Electronics is 1.48 times more volatile than Jacquet Metal Service. It trades about -0.03 of its total potential returns per unit of risk. Jacquet Metal Service is currently generating about 0.01 per unit of volatility. If you would invest 1,547 in Jacquet Metal Service on August 29, 2024 and sell it today you would earn a total of 1.00 from holding Jacquet Metal Service or generate 0.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
UMC Electronics Co vs. Jacquet Metal Service
Performance |
| Timeline |
| UMC Electronics |
| Jacquet Metal Service |
UMC Electronics and Jacquet Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UMC Electronics and Jacquet Metal
The main advantage of trading using opposite UMC Electronics and Jacquet Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UMC Electronics position performs unexpectedly, Jacquet Metal 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 Jacquet Metal will offset losses from the drop in Jacquet Metal's long position.| UMC Electronics vs. CECO ENVIRONMENTAL | UMC Electronics vs. Datadog | UMC Electronics vs. Hyrican Informationssysteme Aktiengesellschaft | UMC Electronics vs. Perma Fix Environmental Services |
| Jacquet Metal vs. Marie Brizard Wine | Jacquet Metal vs. Treasury Wine Estates | Jacquet Metal vs. GEELY AUTOMOBILE | Jacquet Metal vs. Gol Intelligent Airlines |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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