Correlation Between YuantaP Shares and ANJI Technology

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Can any of the company-specific risk be diversified away by investing in both YuantaP Shares and ANJI Technology 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 YuantaP Shares and ANJI Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YuantaP shares Taiwan Top and ANJI Technology Co, you can compare the effects of market volatilities on YuantaP Shares and ANJI Technology 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 YuantaP Shares with a short position of ANJI Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of YuantaP Shares and ANJI Technology.

Diversification Opportunities for YuantaP Shares and ANJI Technology

0.36
  Correlation Coefficient

Weak diversification

The 3 months correlation between YuantaP and ANJI is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding YuantaP shares Taiwan Top and ANJI Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANJI Technology and YuantaP Shares 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 YuantaP shares Taiwan Top are associated (or correlated) with ANJI Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANJI Technology has no effect on the direction of YuantaP Shares i.e., YuantaP Shares and ANJI Technology go up and down completely randomly.

Pair Corralation between YuantaP Shares and ANJI Technology

Assuming the 90 days trading horizon YuantaP Shares is expected to generate 11.07 times less return on investment than ANJI Technology. But when comparing it to its historical volatility, YuantaP shares Taiwan Top is 3.06 times less risky than ANJI Technology. It trades about 0.13 of its potential returns per unit of risk. ANJI Technology Co is currently generating about 0.46 of returns per unit of risk over similar time horizon. If you would invest  2,725  in ANJI Technology Co on October 21, 2024 and sell it today you would earn a total of  1,195  from holding ANJI Technology Co or generate 43.85% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

YuantaP shares Taiwan Top  vs.  ANJI Technology Co

 Performance 
       Timeline  
YuantaP shares Taiwan 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days YuantaP shares Taiwan Top has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, YuantaP Shares is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.
ANJI Technology 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in ANJI Technology Co are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, ANJI Technology showed solid returns over the last few months and may actually be approaching a breakup point.

YuantaP Shares and ANJI Technology Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with YuantaP Shares and ANJI Technology

The main advantage of trading using opposite YuantaP Shares and ANJI Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YuantaP Shares position performs unexpectedly, ANJI Technology 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 ANJI Technology will offset losses from the drop in ANJI Technology's long position.
The idea behind YuantaP shares Taiwan Top and ANJI Technology Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.

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