Correlation Between Amkor Technology and Guidewire Software
Can any of the company-specific risk be diversified away by investing in both Amkor Technology and Guidewire Software 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 Amkor Technology and Guidewire Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amkor Technology and Guidewire Software, you can compare the effects of market volatilities on Amkor Technology and Guidewire Software 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 Amkor Technology with a short position of Guidewire Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amkor Technology and Guidewire Software.
Diversification Opportunities for Amkor Technology and Guidewire Software
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Amkor and Guidewire is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Amkor Technology and Guidewire Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guidewire Software and Amkor 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 Amkor Technology are associated (or correlated) with Guidewire Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guidewire Software has no effect on the direction of Amkor Technology i.e., Amkor Technology and Guidewire Software go up and down completely randomly.
Pair Corralation between Amkor Technology and Guidewire Software
Assuming the 90 days horizon Amkor Technology is expected to generate 1.31 times more return on investment than Guidewire Software. However, Amkor Technology is 1.31 times more volatile than Guidewire Software. It trades about 0.05 of its potential returns per unit of risk. Guidewire Software is currently generating about 0.02 per unit of risk. If you would invest 2,524 in Amkor Technology on October 13, 2024 and sell it today you would earn a total of 31.00 from holding Amkor Technology or generate 1.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Amkor Technology vs. Guidewire Software
Performance |
| Timeline |
| Amkor Technology |
| Guidewire Software |
Amkor Technology and Guidewire Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amkor Technology and Guidewire Software
The main advantage of trading using opposite Amkor Technology and Guidewire Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amkor Technology position performs unexpectedly, Guidewire Software 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 Guidewire Software will offset losses from the drop in Guidewire Software's long position.| Amkor Technology vs. MOBILE FACTORY INC | Amkor Technology vs. CAREER EDUCATION | Amkor Technology vs. FIH MOBILE | Amkor Technology vs. G8 EDUCATION |
| Guidewire Software vs. TYSON FOODS A | Guidewire Software vs. Solstad Offshore ASA | Guidewire Software vs. Addus HomeCare | Guidewire Software vs. Tyson Foods |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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