Correlation Between ATrack Technology and PChome Online

Can any of the company-specific risk be diversified away by investing in both ATrack Technology and PChome Online 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 ATrack Technology and PChome Online into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ATrack Technology and PChome Online, you can compare the effects of market volatilities on ATrack Technology and PChome Online 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 ATrack Technology with a short position of PChome Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATrack Technology and PChome Online.

Diversification Opportunities for ATrack Technology and PChome Online

0.7

Correlation Coefficient

ATrack Technology  PChome Online

Poor diversification

The 3 months correlation between ATrack and PChome is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding ATrack Technology and PChome Online in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PChome Online and ATrack Technology 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 ATrack Technology are associated (or correlated) with PChome Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PChome Online has no effect on the direction of ATrack Technology i.e., ATrack Technology and PChome Online go up and down completely randomly.

Pair Corralation between ATrack Technology and PChome Online

Assuming the 90 days trading horizon ATrack Technology is expected to under-perform the PChome Online. In addition to that, ATrack Technology is 1.91 times more volatile than PChome Online. It trades about -0.06 of its total potential returns per unit of risk. PChome Online is currently generating about -0.05 per unit of volatility. If you would invest  4,755  in PChome Online on December 24, 2024 and sell it today you would lose (440.00) from holding PChome Online or give up 9.25% of portfolio value over 90 days.

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

ATrack Technology  vs.  PChome Online

ATrack Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days ATrack Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

PChome Online

Risk-Adjusted Performance

Very Weak

Over the last 90 days PChome Online 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 ATrack Technology and PChome Online

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

The idea behind ATrack Technology and PChome Online 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.