Correlation Between Sonix Technology and Holtek Semiconductor
Can any of the company-specific risk be diversified away by investing in both Sonix Technology 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 Sonix Technology and Holtek Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sonix Technology Co and Holtek Semiconductor, you can compare the effects of market volatilities on Sonix Technology 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 Sonix Technology with a short position of Holtek Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sonix Technology and Holtek Semiconductor.
Diversification Opportunities for Sonix Technology and Holtek Semiconductor
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sonix and Holtek is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Sonix Technology Co and Holtek Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holtek Semiconductor and Sonix 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 Sonix Technology Co 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 Sonix Technology i.e., Sonix Technology and Holtek Semiconductor go up and down completely randomly.
Pair Corralation between Sonix Technology and Holtek Semiconductor
Assuming the 90 days trading horizon Sonix Technology Co is expected to under-perform the Holtek Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Sonix Technology Co is 1.49 times less risky than Holtek Semiconductor. The stock trades about -0.37 of its potential returns per unit of risk. The Holtek Semiconductor is currently generating about -0.13 of returns per unit of risk over similar time horizon. If you would invest 5,400 in Holtek Semiconductor on September 2, 2024 and sell it today you would lose (340.00) from holding Holtek Semiconductor or give up 6.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sonix Technology Co vs. Holtek Semiconductor
Performance |
| Timeline |
| Sonix Technology |
| Holtek Semiconductor |
Sonix Technology and Holtek Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sonix Technology and Holtek Semiconductor
The main advantage of trading using opposite Sonix Technology and Holtek Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sonix Technology 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.| Sonix Technology vs. Novatek Microelectronics Corp | Sonix Technology vs. Holtek Semiconductor | Sonix Technology vs. Sunplus Technology Co | Sonix Technology vs. Elan Microelectronics Corp |
| 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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