Correlation Between Applied Blockchain and Melexis NV
Can any of the company-specific risk be diversified away by investing in both Applied Blockchain and Melexis NV 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 Applied Blockchain and Melexis NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Applied Blockchain and Melexis NV, you can compare the effects of market volatilities on Applied Blockchain and Melexis NV 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 Applied Blockchain with a short position of Melexis NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Applied Blockchain and Melexis NV.
Diversification Opportunities for Applied Blockchain and Melexis NV
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Applied and Melexis is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Applied Blockchain and Melexis NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Melexis NV and Applied Blockchain 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 Applied Blockchain are associated (or correlated) with Melexis NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Melexis NV has no effect on the direction of Applied Blockchain i.e., Applied Blockchain and Melexis NV go up and down completely randomly.
Pair Corralation between Applied Blockchain and Melexis NV
If you would invest 787.00 in Applied Blockchain on August 30, 2024 and sell it today you would earn a total of 179.00 from holding Applied Blockchain or generate 22.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Applied Blockchain vs. Melexis NV
Performance |
| Timeline |
| Applied Blockchain |
| Melexis NV |
Applied Blockchain and Melexis NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Applied Blockchain and Melexis NV
The main advantage of trading using opposite Applied Blockchain and Melexis NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Applied Blockchain position performs unexpectedly, Melexis NV 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 Melexis NV will offset losses from the drop in Melexis NV's long position.| Applied Blockchain vs. Magic Empire Global | Applied Blockchain vs. Zhong Yang Financial | Applied Blockchain vs. Netcapital | Applied Blockchain vs. Lazard |
| Melexis NV vs. NVIDIA | Melexis NV vs. Intel | Melexis NV vs. Taiwan Semiconductor Manufacturing | Melexis NV vs. Marvell Technology Group |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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