Correlation Between Intech Biopharm and Macronix International
Can any of the company-specific risk be diversified away by investing in both Intech Biopharm and Macronix International 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 Intech Biopharm and Macronix International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intech Biopharm and Macronix International Co, you can compare the effects of market volatilities on Intech Biopharm and Macronix International 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 Intech Biopharm with a short position of Macronix International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intech Biopharm and Macronix International.
Diversification Opportunities for Intech Biopharm and Macronix International
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Intech and Macronix is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Intech Biopharm and Macronix International Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macronix International and Intech Biopharm 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 Intech Biopharm are associated (or correlated) with Macronix International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macronix International has no effect on the direction of Intech Biopharm i.e., Intech Biopharm and Macronix International go up and down completely randomly.
Pair Corralation between Intech Biopharm and Macronix International
Assuming the 90 days trading horizon Intech Biopharm is expected to generate 0.48 times more return on investment than Macronix International. However, Intech Biopharm is 2.1 times less risky than Macronix International. It trades about -0.14 of its potential returns per unit of risk. Macronix International Co is currently generating about -0.27 per unit of risk. If you would invest 2,815 in Intech Biopharm on September 1, 2024 and sell it today you would lose (105.00) from holding Intech Biopharm or give up 3.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Intech Biopharm vs. Macronix International Co
Performance |
| Timeline |
| Intech Biopharm |
| Macronix International |
Intech Biopharm and Macronix International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intech Biopharm and Macronix International
The main advantage of trading using opposite Intech Biopharm and Macronix International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intech Biopharm position performs unexpectedly, Macronix International 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 Macronix International will offset losses from the drop in Macronix International's long position.| Intech Biopharm vs. Vanguard International Semiconductor | Intech Biopharm vs. Holtek Semiconductor | Intech Biopharm vs. Davicom Semiconductor | Intech Biopharm vs. Niko Semiconductor Co |
| Macronix International vs. United Microelectronics | Macronix International vs. Winbond Electronics 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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