Correlation Between ASE Industrial and DSP
Can any of the company-specific risk be diversified away by investing in both ASE Industrial and DSP 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 ASE Industrial and DSP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASE Industrial Holding and DSP Group, you can compare the effects of market volatilities on ASE Industrial and DSP 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 ASE Industrial with a short position of DSP. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASE Industrial and DSP.
Diversification Opportunities for ASE Industrial and DSP
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ASE and DSP is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ASE Industrial Holding and DSP Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DSP Group and ASE Industrial 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 ASE Industrial Holding are associated (or correlated) with DSP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DSP Group has no effect on the direction of ASE Industrial i.e., ASE Industrial and DSP go up and down completely randomly.
Pair Corralation between ASE Industrial and DSP
If you would invest (100.00) in DSP Group on January 26, 2024 and sell it today you would earn a total of 100.00 from holding DSP Group or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
ASE Industrial Holding vs. DSP Group
Performance |
| Timeline |
| ASE Industrial Holding |
| DSP Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ASE Industrial and DSP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASE Industrial and DSP
The main advantage of trading using opposite ASE Industrial and DSP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASE Industrial position performs unexpectedly, DSP 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 DSP will offset losses from the drop in DSP's long position.| ASE Industrial vs. United Microelectronics | ASE Industrial vs. Amkor Technology | ASE Industrial vs. Himax Technologies | ASE Industrial vs. Chunghwa Telecom Co |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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