Correlation Between GigaDevice SemiconductorBei and Ingenic Semiconductor
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By analyzing existing cross correlation between GigaDevice SemiconductorBeiji and Ingenic Semiconductor, you can compare the effects of market volatilities on GigaDevice SemiconductorBei and Ingenic 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 GigaDevice SemiconductorBei with a short position of Ingenic Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of GigaDevice SemiconductorBei and Ingenic Semiconductor.
Diversification Opportunities for GigaDevice SemiconductorBei and Ingenic Semiconductor
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GigaDevice and Ingenic is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding GigaDevice SemiconductorBeiji and Ingenic Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ingenic Semiconductor and GigaDevice SemiconductorBei 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 GigaDevice SemiconductorBeiji are associated (or correlated) with Ingenic Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ingenic Semiconductor has no effect on the direction of GigaDevice SemiconductorBei i.e., GigaDevice SemiconductorBei and Ingenic Semiconductor go up and down completely randomly.
Pair Corralation between GigaDevice SemiconductorBei and Ingenic Semiconductor
Assuming the 90 days trading horizon GigaDevice SemiconductorBeiji is expected to generate 1.59 times more return on investment than Ingenic Semiconductor. However, GigaDevice SemiconductorBei is 1.59 times more volatile than Ingenic Semiconductor. It trades about 0.26 of its potential returns per unit of risk. Ingenic Semiconductor is currently generating about -0.01 per unit of risk. If you would invest 8,391 in GigaDevice SemiconductorBeiji on October 26, 2024 and sell it today you would earn a total of 4,656 from holding GigaDevice SemiconductorBeiji or generate 55.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GigaDevice SemiconductorBeiji vs. Ingenic Semiconductor
Performance |
| Timeline |
| GigaDevice SemiconductorBei |
| Ingenic Semiconductor |
GigaDevice SemiconductorBei and Ingenic Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GigaDevice SemiconductorBei and Ingenic Semiconductor
The main advantage of trading using opposite GigaDevice SemiconductorBei and Ingenic Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GigaDevice SemiconductorBei position performs unexpectedly, Ingenic 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 Ingenic Semiconductor will offset losses from the drop in Ingenic Semiconductor's long position.The idea behind GigaDevice SemiconductorBeiji and Ingenic 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.
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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