Correlation Between Yuanta Securities and YuantaP Shares

Can any of the company-specific risk be diversified away by investing in both Yuanta Securities and YuantaP Shares 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 Yuanta Securities and YuantaP Shares into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Yuanta Securities Investment and YuantaP shares Taiwan Top, you can compare the effects of market volatilities on Yuanta Securities and YuantaP Shares 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 Yuanta Securities with a short position of YuantaP Shares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuanta Securities and YuantaP Shares.

Diversification Opportunities for Yuanta Securities and YuantaP Shares

0.11

Correlation Coefficient

Yuanta Securities  YuantaP Shares

Average diversification

The 3 months correlation between Yuanta and YuantaP is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Yuanta Securities Investment and YuantaP shares Taiwan Top in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YuantaP shares Taiwan and Yuanta Securities 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 Yuanta Securities Investment are associated (or correlated) with YuantaP Shares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YuantaP shares Taiwan has no effect on the direction of Yuanta Securities i.e., Yuanta Securities and YuantaP Shares go up and down completely randomly.

Pair Corralation between Yuanta Securities and YuantaP Shares

Assuming the 90 days trading horizon Yuanta Securities Investment is expected to under-perform the YuantaP Shares. But the etf apears to be less risky and, when comparing its historical volatility, Yuanta Securities Investment is 1.69 times less risky than YuantaP Shares. The etf trades about -0.37 of its potential returns per unit of risk. The YuantaP shares Taiwan Top is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest  19,308  in YuantaP shares Taiwan Top on December 31, 2024 and sell it today you would lose (1,388) from holding YuantaP shares Taiwan Top or give up 7.19% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Yuanta Securities Investment  vs.  YuantaP shares Taiwan Top

Yuanta Securities

Risk-Adjusted Performance

Very Weak

Over the last 90 days Yuanta Securities Investment has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Etf's basic indicators remain somewhat strong which may send shares a bit higher in May 2025. The current disturbance may also be a sign of long term up-swing for the ETF investors.

YuantaP shares Taiwan

Risk-Adjusted Performance

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 latest weak performance, the Etf's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the fund sophisticated investors.

Pair Trading with Yuanta Securities and YuantaP Shares

The main advantage of trading using opposite Yuanta Securities and YuantaP Shares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuanta Securities position performs unexpectedly, YuantaP Shares 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 YuantaP Shares will offset losses from the drop in YuantaP Shares' long position.

The idea behind Yuanta Securities Investment and YuantaP shares Taiwan Top 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.