Correlation Between Ingenic Semiconductor and Suzhou Oriental
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By analyzing existing cross correlation between Ingenic Semiconductor and Suzhou Oriental Semiconductor, you can compare the effects of market volatilities on Ingenic Semiconductor and Suzhou Oriental 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 Suzhou Oriental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingenic Semiconductor and Suzhou Oriental.
Diversification Opportunities for Ingenic Semiconductor and Suzhou Oriental
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ingenic and Suzhou is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Ingenic Semiconductor and Suzhou Oriental Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suzhou Oriental Semi 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 Suzhou Oriental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suzhou Oriental Semi has no effect on the direction of Ingenic Semiconductor i.e., Ingenic Semiconductor and Suzhou Oriental go up and down completely randomly.
Pair Corralation between Ingenic Semiconductor and Suzhou Oriental
Assuming the 90 days trading horizon Ingenic Semiconductor is expected to generate 1.04 times more return on investment than Suzhou Oriental. However, Ingenic Semiconductor is 1.04 times more volatile than Suzhou Oriental Semiconductor. It trades about -0.15 of its potential returns per unit of risk. Suzhou Oriental Semiconductor is currently generating about -0.25 per unit of risk. If you would invest 7,275 in Ingenic Semiconductor on October 26, 2024 and sell it today you would lose (694.00) from holding Ingenic Semiconductor or give up 9.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ingenic Semiconductor vs. Suzhou Oriental Semiconductor
Performance |
| Timeline |
| Ingenic Semiconductor |
| Suzhou Oriental Semi |
Ingenic Semiconductor and Suzhou Oriental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingenic Semiconductor and Suzhou Oriental
The main advantage of trading using opposite Ingenic Semiconductor and Suzhou Oriental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingenic Semiconductor position performs unexpectedly, Suzhou Oriental 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 Suzhou Oriental will offset losses from the drop in Suzhou Oriental's long position.The idea behind Ingenic Semiconductor and Suzhou Oriental Semiconductor 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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