Correlation Between Jentech Precision and Union Bank
Can any of the company-specific risk be diversified away by investing in both Jentech Precision and Union Bank 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 Jentech Precision and Union Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jentech Precision Industrial and Union Bank of, you can compare the effects of market volatilities on Jentech Precision and Union Bank 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 Jentech Precision with a short position of Union Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jentech Precision and Union Bank.
Diversification Opportunities for Jentech Precision and Union Bank
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jentech and Union is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Jentech Precision Industrial and Union Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Union Bank and Jentech Precision 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 Jentech Precision Industrial are associated (or correlated) with Union Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Union Bank has no effect on the direction of Jentech Precision i.e., Jentech Precision and Union Bank go up and down completely randomly.
Pair Corralation between Jentech Precision and Union Bank
Assuming the 90 days trading horizon Jentech Precision Industrial is expected to generate 4.03 times more return on investment than Union Bank. However, Jentech Precision is 4.03 times more volatile than Union Bank of. It trades about -0.02 of its potential returns per unit of risk. Union Bank of is currently generating about -0.11 per unit of risk. If you would invest 150,000 in Jentech Precision Industrial on September 26, 2024 and sell it today you would lose (3,500) from holding Jentech Precision Industrial or give up 2.33% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Jentech Precision Industrial vs. Union Bank of
Performance |
Timeline |
Jentech Precision |
Union Bank |
Jentech Precision and Union Bank Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jentech Precision and Union Bank
The main advantage of trading using opposite Jentech Precision and Union Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jentech Precision position performs unexpectedly, Union Bank 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 Union Bank will offset losses from the drop in Union Bank's long position.Jentech Precision vs. Lotes Co | Jentech Precision vs. Nan Ya Printed | Jentech Precision vs. Global Unichip Corp | Jentech Precision vs. Tong Hsing Electronic |
Union Bank vs. Taiwan Semiconductor Manufacturing | Union Bank vs. Hon Hai Precision | Union Bank vs. MediaTek | Union Bank vs. Chunghwa Telecom Co |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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