Correlation Between X-FAB Silicon and Data#3
Can any of the company-specific risk be diversified away by investing in both X-FAB Silicon and Data#3 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 X-FAB Silicon and Data#3 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between X FAB Silicon Foundries and Data3 Limited, you can compare the effects of market volatilities on X-FAB Silicon and Data#3 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 X-FAB Silicon with a short position of Data#3. Check out your portfolio center. Please also check ongoing floating volatility patterns of X-FAB Silicon and Data#3.
Diversification Opportunities for X-FAB Silicon and Data#3
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between X-FAB and Data#3 is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding X FAB Silicon Foundries and Data3 Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Data3 Limited and X-FAB Silicon 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 X FAB Silicon Foundries are associated (or correlated) with Data#3. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Data3 Limited has no effect on the direction of X-FAB Silicon i.e., X-FAB Silicon and Data#3 go up and down completely randomly.
Pair Corralation between X-FAB Silicon and Data#3
Assuming the 90 days trading horizon X FAB Silicon Foundries is expected to generate 1.53 times more return on investment than Data#3. However, X-FAB Silicon is 1.53 times more volatile than Data3 Limited. It trades about 0.15 of its potential returns per unit of risk. Data3 Limited is currently generating about 0.05 per unit of risk. If you would invest 480.00 in X FAB Silicon Foundries on October 22, 2024 and sell it today you would earn a total of 29.00 from holding X FAB Silicon Foundries or generate 6.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.12% |
| Values | Daily Returns |
X FAB Silicon Foundries vs. Data3 Limited
Performance |
| Timeline |
| X FAB Silicon |
| Data3 Limited |
X-FAB Silicon and Data#3 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with X-FAB Silicon and Data#3
The main advantage of trading using opposite X-FAB Silicon and Data#3 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if X-FAB Silicon position performs unexpectedly, Data#3 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 Data#3 will offset losses from the drop in Data#3's long position.| X-FAB Silicon vs. PARKEN Sport Entertainment | X-FAB Silicon vs. GigaMedia | X-FAB Silicon vs. CSSC Offshore Marine | X-FAB Silicon vs. Live Nation Entertainment |
| Data#3 vs. Live Nation Entertainment | Data#3 vs. Tencent Music Entertainment | Data#3 vs. GungHo Online Entertainment | Data#3 vs. Golden Entertainment |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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