Correlation Between SIVERS SEMICONDUCTORS and Esso (Thailand)
Can any of the company-specific risk be diversified away by investing in both SIVERS SEMICONDUCTORS and Esso (Thailand) 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 SIVERS SEMICONDUCTORS and Esso (Thailand) into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SIVERS SEMICONDUCTORS AB and Esso Public, you can compare the effects of market volatilities on SIVERS SEMICONDUCTORS and Esso (Thailand) 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 SIVERS SEMICONDUCTORS with a short position of Esso (Thailand). Check out your portfolio center. Please also check ongoing floating volatility patterns of SIVERS SEMICONDUCTORS and Esso (Thailand).
Diversification Opportunities for SIVERS SEMICONDUCTORS and Esso (Thailand)
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SIVERS and Esso is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding SIVERS SEMICONDUCTORS AB and Esso Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Esso (Thailand) and SIVERS SEMICONDUCTORS 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 SIVERS SEMICONDUCTORS AB are associated (or correlated) with Esso (Thailand). Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Esso (Thailand) has no effect on the direction of SIVERS SEMICONDUCTORS i.e., SIVERS SEMICONDUCTORS and Esso (Thailand) go up and down completely randomly.
Pair Corralation between SIVERS SEMICONDUCTORS and Esso (Thailand)
Assuming the 90 days horizon SIVERS SEMICONDUCTORS is expected to generate 3.96 times less return on investment than Esso (Thailand). But when comparing it to its historical volatility, SIVERS SEMICONDUCTORS AB is 1.1 times less risky than Esso (Thailand). It trades about 0.02 of its potential returns per unit of risk. Esso Public is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 12.00 in Esso Public on October 1, 2024 and sell it today you would earn a total of 8.00 from holding Esso Public or generate 66.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SIVERS SEMICONDUCTORS AB vs. Esso Public
Performance |
| Timeline |
| SIVERS SEMICONDUCTORS |
| Esso (Thailand) |
SIVERS SEMICONDUCTORS and Esso (Thailand) Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIVERS SEMICONDUCTORS and Esso (Thailand)
The main advantage of trading using opposite SIVERS SEMICONDUCTORS and Esso (Thailand) positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIVERS SEMICONDUCTORS position performs unexpectedly, Esso (Thailand) 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 Esso (Thailand) will offset losses from the drop in Esso (Thailand)'s long position.| SIVERS SEMICONDUCTORS vs. Broadcom | SIVERS SEMICONDUCTORS vs. Texas Instruments Incorporated | SIVERS SEMICONDUCTORS vs. QUALCOMM Incorporated | SIVERS SEMICONDUCTORS vs. Advanced Micro Devices |
| Esso (Thailand) vs. Reliance Industries Limited | Esso (Thailand) vs. Marathon Petroleum Corp | Esso (Thailand) vs. NESTE OYJ UNSPADR | Esso (Thailand) vs. Polski Koncern Naftowy |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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