Correlation Between DXC Technology and Amkor Technology
Can any of the company-specific risk be diversified away by investing in both DXC Technology and Amkor Technology 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 DXC Technology and Amkor Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DXC Technology Co and Amkor Technology, you can compare the effects of market volatilities on DXC Technology and Amkor Technology 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 DXC Technology with a short position of Amkor Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of DXC Technology and Amkor Technology.
Diversification Opportunities for DXC Technology and Amkor Technology
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between DXC and Amkor is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding DXC Technology Co and Amkor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amkor Technology and DXC 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 DXC Technology Co are associated (or correlated) with Amkor Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amkor Technology has no effect on the direction of DXC Technology i.e., DXC Technology and Amkor Technology go up and down completely randomly.
Pair Corralation between DXC Technology and Amkor Technology
Assuming the 90 days trading horizon DXC Technology Co is expected to generate 1.39 times more return on investment than Amkor Technology. However, DXC Technology is 1.39 times more volatile than Amkor Technology. It trades about 0.17 of its potential returns per unit of risk. Amkor Technology is currently generating about -0.01 per unit of risk. If you would invest 1,890 in DXC Technology Co on August 30, 2024 and sell it today you would earn a total of 217.00 from holding DXC Technology Co or generate 11.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DXC Technology Co vs. Amkor Technology
Performance |
| Timeline |
| DXC Technology |
| Amkor Technology |
DXC Technology and Amkor Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DXC Technology and Amkor Technology
The main advantage of trading using opposite DXC Technology and Amkor Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DXC Technology position performs unexpectedly, Amkor Technology 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 Amkor Technology will offset losses from the drop in Amkor Technology's long position.| DXC Technology vs. Apple Inc | DXC Technology vs. Apple Inc | DXC Technology vs. Apple Inc | DXC Technology vs. Apple Inc |
| Amkor Technology vs. NVIDIA | Amkor Technology vs. Texas Instruments Incorporated | Amkor Technology vs. Advanced Micro Devices | Amkor Technology vs. Advanced Micro Devices |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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