Correlation Between Advanced Micro and GCT Semiconductor
Can any of the company-specific risk be diversified away by investing in both Advanced Micro and GCT 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 Advanced Micro and GCT Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advanced Micro Devices and GCT Semiconductor Holding, you can compare the effects of market volatilities on Advanced Micro and GCT 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 Advanced Micro with a short position of GCT Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Micro and GCT Semiconductor.
Diversification Opportunities for Advanced Micro and GCT Semiconductor
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Advanced and GCT is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Micro Devices and GCT Semiconductor Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GCT Semiconductor Holding and Advanced Micro 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 Advanced Micro Devices are associated (or correlated) with GCT Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GCT Semiconductor Holding has no effect on the direction of Advanced Micro i.e., Advanced Micro and GCT Semiconductor go up and down completely randomly.
Pair Corralation between Advanced Micro and GCT Semiconductor
Considering the 90-day investment horizon Advanced Micro is expected to generate 2.4 times less return on investment than GCT Semiconductor. But when comparing it to its historical volatility, Advanced Micro Devices is 2.65 times less risky than GCT Semiconductor. It trades about 0.03 of its potential returns per unit of risk. GCT Semiconductor Holding is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 254.00 in GCT Semiconductor Holding on September 4, 2024 and sell it today you would earn a total of 1.00 from holding GCT Semiconductor Holding or generate 0.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Advanced Micro Devices vs. GCT Semiconductor Holding
Performance |
| Timeline |
| Advanced Micro Devices |
| GCT Semiconductor Holding |
Advanced Micro and GCT Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advanced Micro and GCT Semiconductor
The main advantage of trading using opposite Advanced Micro and GCT Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advanced Micro position performs unexpectedly, GCT 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 GCT Semiconductor will offset losses from the drop in GCT Semiconductor's long position.| Advanced Micro vs. Taiwan Semiconductor Manufacturing | Advanced Micro vs. Intel | Advanced Micro vs. Marvell Technology Group | Advanced Micro vs. Micron Technology |
| GCT Semiconductor vs. Taiwan Semiconductor Manufacturing | GCT Semiconductor vs. MACOM Technology Solutions | GCT Semiconductor vs. Everspin Technologies | GCT Semiconductor vs. National Vision Holdings |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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