Correlation Between Kinko Optical and Gemtek Technology
Can any of the company-specific risk be diversified away by investing in both Kinko Optical and Gemtek 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 Kinko Optical and Gemtek Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinko Optical Co and Gemtek Technology Co, you can compare the effects of market volatilities on Kinko Optical and Gemtek 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 Kinko Optical with a short position of Gemtek Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinko Optical and Gemtek Technology.
Diversification Opportunities for Kinko Optical and Gemtek Technology
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kinko and Gemtek is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Kinko Optical Co and Gemtek Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gemtek Technology and Kinko Optical 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 Kinko Optical Co are associated (or correlated) with Gemtek Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gemtek Technology has no effect on the direction of Kinko Optical i.e., Kinko Optical and Gemtek Technology go up and down completely randomly.
Pair Corralation between Kinko Optical and Gemtek Technology
Assuming the 90 days trading horizon Kinko Optical is expected to generate 3.5 times less return on investment than Gemtek Technology. But when comparing it to its historical volatility, Kinko Optical Co is 1.06 times less risky than Gemtek Technology. It trades about 0.01 of its potential returns per unit of risk. Gemtek Technology Co is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,735 in Gemtek Technology Co on September 13, 2024 and sell it today you would earn a total of 720.00 from holding Gemtek Technology Co or generate 26.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Kinko Optical Co vs. Gemtek Technology Co
Performance |
Timeline |
Kinko Optical |
Gemtek Technology |
Kinko Optical and Gemtek Technology Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Kinko Optical and Gemtek Technology
The main advantage of trading using opposite Kinko Optical and Gemtek Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinko Optical position performs unexpectedly, Gemtek 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 Gemtek Technology will offset losses from the drop in Gemtek Technology's long position.Kinko Optical vs. AU Optronics | Kinko Optical vs. Innolux Corp | Kinko Optical vs. Ruentex Development Co | Kinko Optical vs. WiseChip Semiconductor |
Gemtek Technology vs. AU Optronics | Gemtek Technology vs. Innolux Corp | Gemtek Technology vs. Ruentex Development Co | Gemtek Technology vs. WiseChip Semiconductor |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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