Correlation Between Armada Hflr and YuantaP Shares

Can any of the company-specific risk be diversified away by investing in both Armada Hflr and YuantaP Shares 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 Armada Hflr and YuantaP Shares into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Armada Hflr Pr and YuantaP shares MSCI Taiwan, you can compare the effects of market volatilities on Armada Hflr and YuantaP Shares 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 Armada Hflr with a short position of YuantaP Shares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and YuantaP Shares.

Diversification Opportunities for Armada Hflr and YuantaP Shares

-0.16

Correlation Coefficient

Armada Hflr  YuantaP Shares

Good diversification

The 3 months correlation between Armada and YuantaP is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and YuantaP shares MSCI Taiwan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YuantaP shares MSCI and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with YuantaP Shares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YuantaP shares MSCI has no effect on the direction of Armada Hflr i.e., Armada Hflr and YuantaP Shares go up and down completely randomly.

Pair Corralation between Armada Hflr and YuantaP Shares

Considering the 90-day investment horizon Armada Hflr Pr is expected to under-perform the YuantaP Shares. In addition to that, Armada Hflr is 1.2 times more volatile than YuantaP shares MSCI Taiwan. It trades about -0.27 of its total potential returns per unit of risk. YuantaP shares MSCI Taiwan is currently generating about 0.15 per unit of volatility. If you would invest  8,960  in YuantaP shares MSCI Taiwan on September 27, 2024 and sell it today you would earn a total of  310.00  from holding YuantaP shares MSCI Taiwan or generate 3.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	91.3%
Values	Daily Returns

Armada Hflr Pr  vs.  YuantaP shares MSCI Taiwan

Armada Hflr Pr

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Armada Hflr Pr has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical indicators, Armada Hflr is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

YuantaP shares MSCI

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in YuantaP shares MSCI Taiwan are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, YuantaP Shares is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Armada Hflr and YuantaP Shares

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

The idea behind Armada Hflr Pr and YuantaP shares MSCI Taiwan 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.