Correlation Between ITM Semiconductor and SK IE
Can any of the company-specific risk be diversified away by investing in both ITM Semiconductor and SK IE 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 SK IE 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 SK IE Technology, you can compare the effects of market volatilities on ITM Semiconductor and SK IE 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 SK IE. Check out your portfolio center. Please also check ongoing floating volatility patterns of ITM Semiconductor and SK IE.
Diversification Opportunities for ITM Semiconductor and SK IE
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ITM and 361610 is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding ITM Semiconductor Co and SK IE Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SK IE Technology 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 SK IE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SK IE Technology has no effect on the direction of ITM Semiconductor i.e., ITM Semiconductor and SK IE go up and down completely randomly.
Pair Corralation between ITM Semiconductor and SK IE
Assuming the 90 days trading horizon ITM Semiconductor Co is expected to generate 0.79 times more return on investment than SK IE. However, ITM Semiconductor Co is 1.27 times less risky than SK IE. It trades about -0.38 of its potential returns per unit of risk. SK IE Technology is currently generating about -0.37 per unit of risk. If you would invest 1,860,000 in ITM Semiconductor Co on September 1, 2024 and sell it today you would lose (359,000) from holding ITM Semiconductor Co or give up 19.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ITM Semiconductor Co vs. SK IE Technology
Performance |
| Timeline |
| ITM Semiconductor |
| SK IE Technology |
ITM Semiconductor and SK IE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ITM Semiconductor and SK IE
The main advantage of trading using opposite ITM Semiconductor and SK IE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ITM Semiconductor position performs unexpectedly, SK IE 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 SK IE will offset losses from the drop in SK IE's long position.| ITM Semiconductor vs. SK Hynix | ITM Semiconductor vs. LX Semicon Co | ITM Semiconductor vs. Tokai Carbon Korea | ITM Semiconductor vs. People Technology |
| SK IE vs. MEDIANA CoLtd | SK IE vs. Tway Air Co | SK IE vs. Digital Multimedia Technology | SK IE vs. Nasmedia 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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