Correlation Between Amkor Technology and ETFS Coffee
Can any of the company-specific risk be diversified away by investing in both Amkor Technology and ETFS Coffee 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 ETFS Coffee into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amkor Technology and ETFS Coffee ETC, you can compare the effects of market volatilities on Amkor Technology and ETFS Coffee 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 ETFS Coffee. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amkor Technology and ETFS Coffee.
Diversification Opportunities for Amkor Technology and ETFS Coffee
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Amkor and ETFS is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Amkor Technology and ETFS Coffee ETC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ETFS Coffee ETC 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 ETFS Coffee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ETFS Coffee ETC has no effect on the direction of Amkor Technology i.e., Amkor Technology and ETFS Coffee go up and down completely randomly.
Pair Corralation between Amkor Technology and ETFS Coffee
Assuming the 90 days horizon Amkor Technology is expected to generate 37.73 times less return on investment than ETFS Coffee. But when comparing it to its historical volatility, Amkor Technology is 14.13 times less risky than ETFS Coffee. It trades about 0.02 of its potential returns per unit of risk. ETFS Coffee ETC is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 93.00 in ETFS Coffee ETC on August 29, 2024 and sell it today you would earn a total of 4,836 from holding ETFS Coffee ETC or generate 5200.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.81% |
| Values | Daily Returns |
Amkor Technology vs. ETFS Coffee ETC
Performance |
| Timeline |
| Amkor Technology |
| ETFS Coffee ETC |
Amkor Technology and ETFS Coffee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amkor Technology and ETFS Coffee
The main advantage of trading using opposite Amkor Technology and ETFS Coffee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amkor Technology position performs unexpectedly, ETFS Coffee 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 ETFS Coffee will offset losses from the drop in ETFS Coffee's long position.| Amkor Technology vs. NVIDIA | Amkor Technology vs. Taiwan Semiconductor Manufacturing | Amkor Technology vs. Texas Instruments Incorporated | Amkor Technology vs. Advanced Micro Devices |
| ETFS Coffee vs. Apple Inc | ETFS Coffee vs. Apple Inc | ETFS Coffee vs. Apple Inc | ETFS Coffee vs. Apple Inc |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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