Correlation Between Intuitive Investments and Compal Electronics

Can any of the company-specific risk be diversified away by investing in both Intuitive Investments and Compal Electronics 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 Intuitive Investments and Compal Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Intuitive Investments Group and Compal Electronics GDR, you can compare the effects of market volatilities on Intuitive Investments and Compal Electronics 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 Intuitive Investments with a short position of Compal Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intuitive Investments and Compal Electronics.

Diversification Opportunities for Intuitive Investments and Compal Electronics

-0.28

Correlation Coefficient

Intuitive Investments  Compal Electronics

Very good diversification

The 3 months correlation between Intuitive and Compal is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Intuitive Investments Group and Compal Electronics GDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compal Electronics GDR and Intuitive Investments 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 Intuitive Investments Group are associated (or correlated) with Compal Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compal Electronics GDR has no effect on the direction of Intuitive Investments i.e., Intuitive Investments and Compal Electronics go up and down completely randomly.

Pair Corralation between Intuitive Investments and Compal Electronics

Assuming the 90 days trading horizon Intuitive Investments Group is expected to under-perform the Compal Electronics. But the stock apears to be less risky and, when comparing its historical volatility, Intuitive Investments Group is 6.35 times less risky than Compal Electronics. The stock trades about -0.12 of its potential returns per unit of risk. The Compal Electronics GDR is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  295.00  in Compal Electronics GDR on December 29, 2024 and sell it today you would earn a total of  256.00  from holding Compal Electronics GDR or generate 86.78% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Intuitive Investments Group  vs.  Compal Electronics GDR

Intuitive Investments

Risk-Adjusted Performance

Very Weak

Over the last 90 days Intuitive Investments Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Compal Electronics GDR

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Compal Electronics GDR are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Compal Electronics unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Intuitive Investments and Compal Electronics

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

The idea behind Intuitive Investments Group and Compal Electronics GDR 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..