Correlation Between Taishin Financial and International Games

Can any of the company-specific risk be diversified away by investing in both Taishin Financial and International Games 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 Taishin Financial and International Games into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Taishin Financial Holding and International Games System, you can compare the effects of market volatilities on Taishin Financial and International Games 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 Taishin Financial with a short position of International Games. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taishin Financial and International Games.

Diversification Opportunities for Taishin Financial and International Games

-0.38

Correlation Coefficient

Taishin Financial  International Games

Very good diversification

The 3 months correlation between Taishin and International is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Taishin Financial Holding and International Games System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Games and Taishin Financial 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 Taishin Financial Holding are associated (or correlated) with International Games. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Games has no effect on the direction of Taishin Financial i.e., Taishin Financial and International Games go up and down completely randomly.

Pair Corralation between Taishin Financial and International Games

Assuming the 90 days trading horizon Taishin Financial Holding is expected to generate 0.13 times more return on investment than International Games. However, Taishin Financial Holding is 7.52 times less risky than International Games. It trades about 0.13 of its potential returns per unit of risk. International Games System is currently generating about -0.14 per unit of risk. If you would invest  5,110  in Taishin Financial Holding on October 24, 2024 and sell it today you would earn a total of  30.00  from holding Taishin Financial Holding or generate 0.59% return on investment over 90 days.

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

Taishin Financial Holding  vs.  International Games System

Taishin Financial Holding

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Taishin Financial Holding are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Taishin Financial is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

International Games

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days International Games System has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with Taishin Financial and International Games

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

The idea behind Taishin Financial Holding and International Games System 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.