Correlation Between Amkor Technology and Davis Commodities
Can any of the company-specific risk be diversified away by investing in both Amkor Technology and Davis Commodities 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 Davis Commodities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amkor Technology and Davis Commodities Limited, you can compare the effects of market volatilities on Amkor Technology and Davis Commodities 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 Davis Commodities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amkor Technology and Davis Commodities.
Diversification Opportunities for Amkor Technology and Davis Commodities
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Amkor and Davis is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Amkor Technology and Davis Commodities Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Davis Commodities 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 Davis Commodities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Davis Commodities has no effect on the direction of Amkor Technology i.e., Amkor Technology and Davis Commodities go up and down completely randomly.
Pair Corralation between Amkor Technology and Davis Commodities
Given the investment horizon of 90 days Amkor Technology is expected to generate 0.34 times more return on investment than Davis Commodities. However, Amkor Technology is 2.94 times less risky than Davis Commodities. It trades about 0.12 of its potential returns per unit of risk. Davis Commodities Limited is currently generating about 0.02 per unit of risk. If you would invest 2,551 in Amkor Technology on September 14, 2024 and sell it today you would earn a total of 118.00 from holding Amkor Technology or generate 4.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amkor Technology vs. Davis Commodities Limited
Performance |
| Timeline |
| Amkor Technology |
| Davis Commodities |
Amkor Technology and Davis Commodities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amkor Technology and Davis Commodities
The main advantage of trading using opposite Amkor Technology and Davis Commodities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amkor Technology position performs unexpectedly, Davis Commodities 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 Davis Commodities will offset losses from the drop in Davis Commodities' long position.| Amkor Technology vs. Power Integrations | Amkor Technology vs. Diodes Incorporated | Amkor Technology vs. MACOM Technology Solutions | Amkor Technology vs. Cirrus Logic |
| Davis Commodities vs. CapitaLand Investment Limited | Davis Commodities vs. Montauk Renewables | Davis Commodities vs. Aegon NV ADR | Davis Commodities vs. Amkor Technology |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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