Correlation Between ITM Semiconductor and InfoBank
Can any of the company-specific risk be diversified away by investing in both ITM Semiconductor and InfoBank 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 ITM Semiconductor and InfoBank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ITM Semiconductor Co and InfoBank, you can compare the effects of market volatilities on ITM Semiconductor and InfoBank 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 ITM Semiconductor with a short position of InfoBank. Check out your portfolio center. Please also check ongoing floating volatility patterns of ITM Semiconductor and InfoBank.
Diversification Opportunities for ITM Semiconductor and InfoBank
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ITM and InfoBank is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding ITM Semiconductor Co and InfoBank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InfoBank and ITM Semiconductor 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 ITM Semiconductor Co are associated (or correlated) with InfoBank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InfoBank has no effect on the direction of ITM Semiconductor i.e., ITM Semiconductor and InfoBank go up and down completely randomly.
Pair Corralation between ITM Semiconductor and InfoBank
Assuming the 90 days trading horizon ITM Semiconductor Co is expected to generate 1.07 times more return on investment than InfoBank. However, ITM Semiconductor is 1.07 times more volatile than InfoBank. It trades about 0.04 of its potential returns per unit of risk. InfoBank is currently generating about -0.08 per unit of risk. If you would invest 1,250,000 in ITM Semiconductor Co on October 28, 2024 and sell it today you would earn a total of 19,000 from holding ITM Semiconductor Co or generate 1.52% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
ITM Semiconductor Co vs. InfoBank
Performance |
Timeline |
ITM Semiconductor |
InfoBank |
ITM Semiconductor and InfoBank Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ITM Semiconductor and InfoBank
The main advantage of trading using opposite ITM Semiconductor and InfoBank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ITM Semiconductor position performs unexpectedly, InfoBank 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 InfoBank will offset losses from the drop in InfoBank's long position.ITM Semiconductor vs. Woorim Machinery Co | ITM Semiconductor vs. Hyundai Engineering Construction | ITM Semiconductor vs. Hanshin Construction Co | ITM Semiconductor vs. SEOJEON ELECTRIC MACHINERY |
InfoBank vs. Samsung Electronics Co | InfoBank vs. Samsung Electronics Co | InfoBank vs. SK Hynix | InfoBank vs. HMM 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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