Correlation Between Sitronix Technology and Niko Semiconductor
Can any of the company-specific risk be diversified away by investing in both Sitronix Technology and Niko 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 Sitronix Technology and Niko Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sitronix Technology Corp and Niko Semiconductor Co, you can compare the effects of market volatilities on Sitronix Technology and Niko 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 Sitronix Technology with a short position of Niko Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sitronix Technology and Niko Semiconductor.
Diversification Opportunities for Sitronix Technology and Niko Semiconductor
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sitronix and Niko is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Sitronix Technology Corp and Niko Semiconductor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Niko Semiconductor and Sitronix 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 Sitronix Technology Corp are associated (or correlated) with Niko Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Niko Semiconductor has no effect on the direction of Sitronix Technology i.e., Sitronix Technology and Niko Semiconductor go up and down completely randomly.
Pair Corralation between Sitronix Technology and Niko Semiconductor
Assuming the 90 days trading horizon Sitronix Technology Corp is expected to under-perform the Niko Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Sitronix Technology Corp is 1.69 times less risky than Niko Semiconductor. The stock trades about -0.12 of its potential returns per unit of risk. The Niko Semiconductor Co is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 4,550 in Niko Semiconductor Co on September 5, 2024 and sell it today you would earn a total of 315.00 from holding Niko Semiconductor Co or generate 6.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sitronix Technology Corp vs. Niko Semiconductor Co
Performance |
| Timeline |
| Sitronix Technology Corp |
| Niko Semiconductor |
Sitronix Technology and Niko Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sitronix Technology and Niko Semiconductor
The main advantage of trading using opposite Sitronix Technology and Niko Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sitronix Technology position performs unexpectedly, Niko 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 Niko Semiconductor will offset losses from the drop in Niko Semiconductor's long position.| Sitronix Technology vs. Novatek Microelectronics Corp | Sitronix Technology vs. FocalTech Systems Co | Sitronix Technology vs. Elan Microelectronics Corp | Sitronix Technology vs. Realtek Semiconductor Corp |
| Niko Semiconductor vs. Excelliance MOS | Niko Semiconductor vs. Sinopower Semiconductor | Niko Semiconductor vs. Advanced Power Electronics | Niko Semiconductor vs. Anpec Electronics |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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