Correlation Between PKSHA TECHNOLOGY and ELMOS SEMICONDUCTOR
Can any of the company-specific risk be diversified away by investing in both PKSHA TECHNOLOGY and ELMOS 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 PKSHA TECHNOLOGY and ELMOS SEMICONDUCTOR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PKSHA TECHNOLOGY INC and ELMOS SEMICONDUCTOR, you can compare the effects of market volatilities on PKSHA TECHNOLOGY and ELMOS 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 PKSHA TECHNOLOGY with a short position of ELMOS SEMICONDUCTOR. Check out your portfolio center. Please also check ongoing floating volatility patterns of PKSHA TECHNOLOGY and ELMOS SEMICONDUCTOR.
Diversification Opportunities for PKSHA TECHNOLOGY and ELMOS SEMICONDUCTOR
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between PKSHA and ELMOS is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding PKSHA TECHNOLOGY INC and ELMOS SEMICONDUCTOR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ELMOS SEMICONDUCTOR and PKSHA 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 PKSHA TECHNOLOGY INC are associated (or correlated) with ELMOS SEMICONDUCTOR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ELMOS SEMICONDUCTOR has no effect on the direction of PKSHA TECHNOLOGY i.e., PKSHA TECHNOLOGY and ELMOS SEMICONDUCTOR go up and down completely randomly.
Pair Corralation between PKSHA TECHNOLOGY and ELMOS SEMICONDUCTOR
Assuming the 90 days horizon PKSHA TECHNOLOGY INC is expected to generate 1.12 times more return on investment than ELMOS SEMICONDUCTOR. However, PKSHA TECHNOLOGY is 1.12 times more volatile than ELMOS SEMICONDUCTOR. It trades about 0.12 of its potential returns per unit of risk. ELMOS SEMICONDUCTOR is currently generating about 0.01 per unit of risk. If you would invest 1,570 in PKSHA TECHNOLOGY INC on November 3, 2024 and sell it today you would earn a total of 830.00 from holding PKSHA TECHNOLOGY INC or generate 52.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PKSHA TECHNOLOGY INC vs. ELMOS SEMICONDUCTOR
Performance |
| Timeline |
| PKSHA TECHNOLOGY INC |
| ELMOS SEMICONDUCTOR |
PKSHA TECHNOLOGY and ELMOS SEMICONDUCTOR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PKSHA TECHNOLOGY and ELMOS SEMICONDUCTOR
The main advantage of trading using opposite PKSHA TECHNOLOGY and ELMOS SEMICONDUCTOR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PKSHA TECHNOLOGY position performs unexpectedly, ELMOS 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 ELMOS SEMICONDUCTOR will offset losses from the drop in ELMOS SEMICONDUCTOR's long position.| PKSHA TECHNOLOGY vs. The Home Depot | PKSHA TECHNOLOGY vs. Focus Home Interactive | PKSHA TECHNOLOGY vs. OFFICE DEPOT | PKSHA TECHNOLOGY vs. DICKS Sporting Goods |
| ELMOS SEMICONDUCTOR vs. Constellation Software | ELMOS SEMICONDUCTOR vs. Alfa Financial Software | ELMOS SEMICONDUCTOR vs. Kingdee International Software | ELMOS SEMICONDUCTOR vs. MUTUIONLINE |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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