Correlation Between Ams AG and Power Integrations
Can any of the company-specific risk be diversified away by investing in both Ams AG and Power Integrations 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 Ams AG and Power Integrations into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ams AG and Power Integrations, you can compare the effects of market volatilities on Ams AG and Power Integrations 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 Ams AG with a short position of Power Integrations. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ams AG and Power Integrations.
Diversification Opportunities for Ams AG and Power Integrations
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ams and Power is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding ams AG and Power Integrations in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Power Integrations and Ams AG 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 ams AG are associated (or correlated) with Power Integrations. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Power Integrations has no effect on the direction of Ams AG i.e., Ams AG and Power Integrations go up and down completely randomly.
Pair Corralation between Ams AG and Power Integrations
Assuming the 90 days horizon ams AG is expected to generate 117.56 times more return on investment than Power Integrations. However, Ams AG is 117.56 times more volatile than Power Integrations. It trades about 0.28 of its potential returns per unit of risk. Power Integrations is currently generating about 0.0 per unit of risk. If you would invest 373.00 in ams AG on September 3, 2024 and sell it today you would lose (85.00) from holding ams AG or give up 22.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ams AG vs. Power Integrations
Performance |
| Timeline |
| ams AG |
| Power Integrations |
Ams AG and Power Integrations Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ams AG and Power Integrations
The main advantage of trading using opposite Ams AG and Power Integrations positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ams AG position performs unexpectedly, Power Integrations 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 Power Integrations will offset losses from the drop in Power Integrations' long position.| Ams AG vs. Aeluma Inc | Ams AG vs. Odyssey Semiconductor Technologies | Ams AG vs. Rohm Co Ltd | Ams AG vs. Intchains Group Limited |
| Power Integrations vs. Diodes Incorporated | Power Integrations vs. MACOM Technology Solutions | Power Integrations vs. Cirrus Logic | Power Integrations 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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