Correlation Between OBI Pharma and Holtek Semiconductor
Can any of the company-specific risk be diversified away by investing in both OBI Pharma and Holtek 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 OBI Pharma and Holtek Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OBI Pharma and Holtek Semiconductor, you can compare the effects of market volatilities on OBI Pharma and Holtek 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 OBI Pharma with a short position of Holtek Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of OBI Pharma and Holtek Semiconductor.
Diversification Opportunities for OBI Pharma and Holtek Semiconductor
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between OBI and Holtek is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding OBI Pharma and Holtek Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holtek Semiconductor and OBI Pharma 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 OBI Pharma are associated (or correlated) with Holtek Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holtek Semiconductor has no effect on the direction of OBI Pharma i.e., OBI Pharma and Holtek Semiconductor go up and down completely randomly.
Pair Corralation between OBI Pharma and Holtek Semiconductor
Assuming the 90 days trading horizon OBI Pharma is expected to generate 0.59 times more return on investment than Holtek Semiconductor. However, OBI Pharma is 1.7 times less risky than Holtek Semiconductor. It trades about -0.18 of its potential returns per unit of risk. Holtek Semiconductor is currently generating about -0.19 per unit of risk. If you would invest 6,620 in OBI Pharma on August 26, 2024 and sell it today you would lose (320.00) from holding OBI Pharma or give up 4.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OBI Pharma vs. Holtek Semiconductor
Performance |
| Timeline |
| OBI Pharma |
| Holtek Semiconductor |
OBI Pharma and Holtek Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OBI Pharma and Holtek Semiconductor
The main advantage of trading using opposite OBI Pharma and Holtek Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OBI Pharma position performs unexpectedly, Holtek 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 Holtek Semiconductor will offset losses from the drop in Holtek Semiconductor's long position.| OBI Pharma vs. TaiMed Biologics | OBI Pharma vs. PharmaEngine | OBI Pharma vs. Medigen Biotechnology | OBI Pharma vs. TTY Biopharm Co |
| Holtek Semiconductor vs. Novatek Microelectronics Corp | Holtek Semiconductor vs. Realtek Semiconductor Corp | Holtek Semiconductor vs. Nuvoton Technology Corp | Holtek Semiconductor vs. Global Unichip Corp |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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