Correlation Between People Technology and ITM Semiconductor
Can any of the company-specific risk be diversified away by investing in both People Technology and ITM Semiconductor 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 People Technology and ITM Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between People Technology and ITM Semiconductor Co, you can compare the effects of market volatilities on People Technology and ITM Semiconductor 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 People Technology with a short position of ITM Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of People Technology and ITM Semiconductor.
Diversification Opportunities for People Technology and ITM Semiconductor
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between People and ITM is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding People Technology and ITM Semiconductor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ITM Semiconductor and People Technology 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 People Technology are associated (or correlated) with ITM Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ITM Semiconductor has no effect on the direction of People Technology i.e., People Technology and ITM Semiconductor go up and down completely randomly.
Pair Corralation between People Technology and ITM Semiconductor
Assuming the 90 days trading horizon People Technology is expected to generate 1.05 times more return on investment than ITM Semiconductor. However, People Technology is 1.05 times more volatile than ITM Semiconductor Co. It trades about 0.02 of its potential returns per unit of risk. ITM Semiconductor Co is currently generating about -0.03 per unit of risk. If you would invest 4,640,578 in People Technology on August 27, 2024 and sell it today you would lose (578.00) from holding People Technology or give up 0.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
People Technology vs. ITM Semiconductor Co
Performance |
| Timeline |
| People Technology |
| ITM Semiconductor |
People Technology and ITM Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with People Technology and ITM Semiconductor
The main advantage of trading using opposite People Technology and ITM Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if People Technology position performs unexpectedly, ITM Semiconductor 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 ITM Semiconductor will offset losses from the drop in ITM Semiconductor's long position.| People Technology vs. Samsung Electronics Co | People Technology vs. Samsung Electronics Co | People Technology vs. Hyundai Motor Co | People Technology vs. Hyundai Motor |
| ITM Semiconductor vs. SK Hynix | ITM Semiconductor vs. People Technology | ITM Semiconductor vs. SIMMTECH Co | ITM Semiconductor vs. Haesung DS 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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