Correlation Between Knowles Cor and ASE Industrial
Can any of the company-specific risk be diversified away by investing in both Knowles Cor and ASE Industrial 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 Knowles Cor and ASE Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Knowles Cor and ASE Industrial Holding, you can compare the effects of market volatilities on Knowles Cor and ASE Industrial 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 Knowles Cor with a short position of ASE Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Knowles Cor and ASE Industrial.
Diversification Opportunities for Knowles Cor and ASE Industrial
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Knowles and ASE is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Knowles Cor and ASE Industrial Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASE Industrial Holding and Knowles Cor 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 Knowles Cor are associated (or correlated) with ASE Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASE Industrial Holding has no effect on the direction of Knowles Cor i.e., Knowles Cor and ASE Industrial go up and down completely randomly.
Pair Corralation between Knowles Cor and ASE Industrial
Allowing for the 90-day total investment horizon Knowles Cor is expected to generate 6.26 times less return on investment than ASE Industrial. But when comparing it to its historical volatility, Knowles Cor is 1.28 times less risky than ASE Industrial. It trades about 0.02 of its potential returns per unit of risk. ASE Industrial Holding is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 927.00 in ASE Industrial Holding on February 7, 2024 and sell it today you would earn a total of 119.00 from holding ASE Industrial Holding or generate 12.84% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Knowles Cor vs. ASE Industrial Holding
Performance |
Timeline |
Knowles Cor |
ASE Industrial Holding |
Knowles Cor and ASE Industrial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Knowles Cor and ASE Industrial
The main advantage of trading using opposite Knowles Cor and ASE Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Knowles Cor position performs unexpectedly, ASE Industrial 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 ASE Industrial will offset losses from the drop in ASE Industrial's long position.Knowles Cor vs. CACI International | Knowles Cor vs. Jack Henry Associates | Knowles Cor vs. ExlService Holdings | Knowles Cor vs. Infosys Ltd ADR |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
Transaction History View history of all your transactions and understand their impact on performance | |
Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
Bonds Directory Find actively traded corporate debentures issued by US companies | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Global Correlations Find global opportunities by holding instruments from different markets | |
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |