Correlation Between WIN Semiconductors and Fun Yours

Can any of the company-specific risk be diversified away by investing in both WIN Semiconductors and Fun Yours 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 WIN Semiconductors and Fun Yours into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for WIN Semiconductors and Fun Yours

0.24

Correlation Coefficient

WIN Semiconductors  Fun Yours

Modest diversification

The 3 months correlation between WIN and Fun is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding WIN Semiconductors and Fun Yours Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fun Yours Technology and WIN Semiconductors 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 WIN Semiconductors are associated (or correlated) with Fun Yours. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fun Yours Technology has no effect on the direction of WIN Semiconductors i.e., WIN Semiconductors and Fun Yours go up and down completely randomly.

Pair Corralation between WIN Semiconductors and Fun Yours

Assuming the 90 days trading horizon WIN Semiconductors is expected to under-perform the Fun Yours. In addition to that, WIN Semiconductors is 1.38 times more volatile than Fun Yours Technology. It trades about -0.09 of its total potential returns per unit of risk. Fun Yours Technology is currently generating about -0.04 per unit of volatility. If you would invest  5,150  in Fun Yours Technology on September 13, 2024 and sell it today you would lose (205.00) from holding Fun Yours Technology or give up 3.98% of portfolio value over 90 days.

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

WIN Semiconductors  vs.  Fun Yours Technology

WIN Semiconductors

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days WIN Semiconductors 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.

Fun Yours Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fun Yours Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Fun Yours is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with WIN Semiconductors and Fun Yours

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

The idea behind WIN Semiconductors and Fun Yours Technology 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.