Correlation Between E Ink and Lin Horn
Can any of the company-specific risk be diversified away by investing in both E Ink and Lin Horn 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 E Ink and Lin Horn into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between E Ink Holdings and Lin Horn Technology, you can compare the effects of market volatilities on E Ink and Lin Horn 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 E Ink with a short position of Lin Horn. Check out your portfolio center. Please also check ongoing floating volatility patterns of E Ink and Lin Horn.
Diversification Opportunities for E Ink and Lin Horn
Very poor diversification
The 3 months correlation between 8069 and Lin is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding E Ink Holdings and Lin Horn Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lin Horn Technology and E Ink 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 E Ink Holdings are associated (or correlated) with Lin Horn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lin Horn Technology has no effect on the direction of E Ink i.e., E Ink and Lin Horn go up and down completely randomly.
Pair Corralation between E Ink and Lin Horn
Assuming the 90 days trading horizon E Ink Holdings is expected to generate 1.85 times more return on investment than Lin Horn. However, E Ink is 1.85 times more volatile than Lin Horn Technology. It trades about 0.05 of its potential returns per unit of risk. Lin Horn Technology is currently generating about -0.38 per unit of risk. If you would invest 26,600 in E Ink Holdings on October 12, 2024 and sell it today you would earn a total of 500.00 from holding E Ink Holdings or generate 1.88% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 95.45% |
Values | Daily Returns |
E Ink Holdings vs. Lin Horn Technology
Performance |
Timeline |
E Ink Holdings |
Lin Horn Technology |
E Ink and Lin Horn Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with E Ink and Lin Horn
The main advantage of trading using opposite E Ink and Lin Horn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if E Ink position performs unexpectedly, Lin Horn 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 Lin Horn will offset losses from the drop in Lin Horn's long position.E Ink vs. Unimicron Technology Corp | E Ink vs. Innolux Corp | E Ink vs. Delta Electronics | E Ink vs. Novatek Microelectronics Corp |
Lin Horn vs. Aerospace Industrial Development | Lin Horn vs. I Jang Industrial | Lin Horn vs. AzureWave Technologies | Lin Horn vs. Intai Technology |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |