Correlation Between Bel Fuse and Amkor Technology
Can any of the company-specific risk be diversified away by investing in both Bel Fuse and Amkor Technology 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 Bel Fuse and Amkor Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bel Fuse A and Amkor Technology, you can compare the effects of market volatilities on Bel Fuse and Amkor Technology 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 Bel Fuse with a short position of Amkor Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bel Fuse and Amkor Technology.
Diversification Opportunities for Bel Fuse and Amkor Technology
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bel and Amkor is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Bel Fuse A and Amkor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amkor Technology and Bel Fuse 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 Bel Fuse A are associated (or correlated) with Amkor Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amkor Technology has no effect on the direction of Bel Fuse i.e., Bel Fuse and Amkor Technology go up and down completely randomly.
Pair Corralation between Bel Fuse and Amkor Technology
Assuming the 90 days horizon Bel Fuse A is expected to generate 0.82 times more return on investment than Amkor Technology. However, Bel Fuse A is 1.22 times less risky than Amkor Technology. It trades about -0.13 of its potential returns per unit of risk. Amkor Technology is currently generating about -0.21 per unit of risk. If you would invest 10,228 in Bel Fuse A on August 29, 2024 and sell it today you would lose (638.00) from holding Bel Fuse A or give up 6.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bel Fuse A vs. Amkor Technology
Performance |
| Timeline |
| Bel Fuse A |
| Amkor Technology |
Bel Fuse and Amkor Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bel Fuse and Amkor Technology
The main advantage of trading using opposite Bel Fuse and Amkor Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bel Fuse position performs unexpectedly, Amkor Technology 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 Amkor Technology will offset losses from the drop in Amkor Technology's long position.| Bel Fuse vs. Richardson Electronics | Bel Fuse vs. Interlink Electronics | Bel Fuse vs. SigmaTron International | Bel Fuse vs. Ouster Inc |
| Amkor Technology vs. Power Integrations | Amkor Technology vs. Diodes Incorporated | Amkor Technology vs. MACOM Technology Solutions | Amkor Technology vs. Cirrus Logic |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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