Correlation Between Ingenic Semiconductor and Orinko Advanced
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By analyzing existing cross correlation between Ingenic Semiconductor and Orinko Advanced Plastics, you can compare the effects of market volatilities on Ingenic Semiconductor and Orinko Advanced 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 Ingenic Semiconductor with a short position of Orinko Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingenic Semiconductor and Orinko Advanced.
Diversification Opportunities for Ingenic Semiconductor and Orinko Advanced
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ingenic and Orinko is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Ingenic Semiconductor and Orinko Advanced Plastics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orinko Advanced Plastics and Ingenic 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 Ingenic Semiconductor are associated (or correlated) with Orinko Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orinko Advanced Plastics has no effect on the direction of Ingenic Semiconductor i.e., Ingenic Semiconductor and Orinko Advanced go up and down completely randomly.
Pair Corralation between Ingenic Semiconductor and Orinko Advanced
Assuming the 90 days trading horizon Ingenic Semiconductor is expected to under-perform the Orinko Advanced. But the stock apears to be less risky and, when comparing its historical volatility, Ingenic Semiconductor is 1.51 times less risky than Orinko Advanced. The stock trades about -0.05 of its potential returns per unit of risk. The Orinko Advanced Plastics is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 936.00 in Orinko Advanced Plastics on October 30, 2024 and sell it today you would earn a total of 138.00 from holding Orinko Advanced Plastics or generate 14.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ingenic Semiconductor vs. Orinko Advanced Plastics
Performance |
| Timeline |
| Ingenic Semiconductor |
| Orinko Advanced Plastics |
Ingenic Semiconductor and Orinko Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingenic Semiconductor and Orinko Advanced
The main advantage of trading using opposite Ingenic Semiconductor and Orinko Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingenic Semiconductor position performs unexpectedly, Orinko Advanced 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 Orinko Advanced will offset losses from the drop in Orinko Advanced's long position.The idea behind Ingenic Semiconductor and Orinko Advanced Plastics pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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