Correlation Between Amkor Technology and EMCOR
Can any of the company-specific risk be diversified away by investing in both Amkor Technology and EMCOR 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 EMCOR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amkor Technology and EMCOR Group, you can compare the effects of market volatilities on Amkor Technology and EMCOR 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 EMCOR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amkor Technology and EMCOR.
Diversification Opportunities for Amkor Technology and EMCOR
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Amkor and EMCOR is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Amkor Technology and EMCOR Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EMCOR Group 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 EMCOR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EMCOR Group has no effect on the direction of Amkor Technology i.e., Amkor Technology and EMCOR go up and down completely randomly.
Pair Corralation between Amkor Technology and EMCOR
Given the investment horizon of 90 days Amkor Technology is expected to generate 19.17 times less return on investment than EMCOR. In addition to that, Amkor Technology is 1.55 times more volatile than EMCOR Group. It trades about 0.01 of its total potential returns per unit of risk. EMCOR Group is currently generating about 0.19 per unit of volatility. If you would invest 21,186 in EMCOR Group on September 2, 2024 and sell it today you would earn a total of 29,826 from holding EMCOR Group or generate 140.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amkor Technology vs. EMCOR Group
Performance |
| Timeline |
| Amkor Technology |
| EMCOR Group |
Amkor Technology and EMCOR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amkor Technology and EMCOR
The main advantage of trading using opposite Amkor Technology and EMCOR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amkor Technology position performs unexpectedly, EMCOR 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 EMCOR will offset losses from the drop in EMCOR's long position.| Amkor Technology vs. NXP Semiconductors NV | Amkor Technology vs. GSI Technology | Amkor Technology vs. MaxLinear | Amkor Technology vs. Texas Instruments Incorporated |
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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