Correlation Between BankUnited and Silicon Motion
Can any of the company-specific risk be diversified away by investing in both BankUnited and Silicon Motion 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 BankUnited and Silicon Motion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BankUnited and Silicon Motion Technology, you can compare the effects of market volatilities on BankUnited and Silicon Motion 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 BankUnited with a short position of Silicon Motion. Check out your portfolio center. Please also check ongoing floating volatility patterns of BankUnited and Silicon Motion.
Diversification Opportunities for BankUnited and Silicon Motion
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between BankUnited and Silicon is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding BankUnited and Silicon Motion Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silicon Motion Technology and BankUnited 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 BankUnited are associated (or correlated) with Silicon Motion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silicon Motion Technology has no effect on the direction of BankUnited i.e., BankUnited and Silicon Motion go up and down completely randomly.
Pair Corralation between BankUnited and Silicon Motion
Assuming the 90 days horizon BankUnited is expected to generate 1.14 times more return on investment than Silicon Motion. However, BankUnited is 1.14 times more volatile than Silicon Motion Technology. It trades about 0.08 of its potential returns per unit of risk. Silicon Motion Technology is currently generating about 0.03 per unit of risk. If you would invest 2,256 in BankUnited on September 12, 2024 and sell it today you would earn a total of 1,684 from holding BankUnited or generate 74.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
BankUnited vs. Silicon Motion Technology
Performance |
| Timeline |
| BankUnited |
| Silicon Motion Technology |
BankUnited and Silicon Motion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BankUnited and Silicon Motion
The main advantage of trading using opposite BankUnited and Silicon Motion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BankUnited position performs unexpectedly, Silicon Motion 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 Silicon Motion will offset losses from the drop in Silicon Motion's long position.| BankUnited vs. Silicon Motion Technology | BankUnited vs. ALERION CLEANPOWER | BankUnited vs. Tencent Music Entertainment | BankUnited vs. KINGBOARD CHEMICAL |
| Silicon Motion vs. Verizon Communications | Silicon Motion vs. Singapore Telecommunications Limited | Silicon Motion vs. Fair Isaac Corp | Silicon Motion vs. Internet Thailand PCL |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |