Correlation Between Burlington Stores and GCT Semiconductor
Can any of the company-specific risk be diversified away by investing in both Burlington Stores and GCT Semiconductor 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 Burlington Stores and GCT Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Burlington Stores and GCT Semiconductor Holding, you can compare the effects of market volatilities on Burlington Stores and GCT Semiconductor 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 Burlington Stores with a short position of GCT Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burlington Stores and GCT Semiconductor.
Diversification Opportunities for Burlington Stores and GCT Semiconductor
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Burlington and GCT is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Burlington Stores and GCT Semiconductor Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GCT Semiconductor Holding and Burlington Stores 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 Burlington Stores are associated (or correlated) with GCT Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GCT Semiconductor Holding has no effect on the direction of Burlington Stores i.e., Burlington Stores and GCT Semiconductor go up and down completely randomly.
Pair Corralation between Burlington Stores and GCT Semiconductor
Given the investment horizon of 90 days Burlington Stores is expected to generate 22.76 times less return on investment than GCT Semiconductor. But when comparing it to its historical volatility, Burlington Stores is 18.1 times less risky than GCT Semiconductor. It trades about 0.03 of its potential returns per unit of risk. GCT Semiconductor Holding is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,049 in GCT Semiconductor Holding on September 3, 2024 and sell it today you would lose (787.00) from holding GCT Semiconductor Holding or give up 75.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 37.05% |
| Values | Daily Returns |
Burlington Stores vs. GCT Semiconductor Holding
Performance |
| Timeline |
| Burlington Stores |
| GCT Semiconductor Holding |
Burlington Stores and GCT Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Burlington Stores and GCT Semiconductor
The main advantage of trading using opposite Burlington Stores and GCT Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Burlington Stores position performs unexpectedly, GCT Semiconductor 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 GCT Semiconductor will offset losses from the drop in GCT Semiconductor's long position.| Burlington Stores vs. The TJX Companies | Burlington Stores vs. Guess Inc | Burlington Stores vs. Urban Outfitters | Burlington Stores vs. Childrens Place |
| GCT Semiconductor vs. Silicon Motion Technology | GCT Semiconductor vs. ASE Industrial Holding | GCT Semiconductor vs. SemiLEDS | GCT Semiconductor vs. Advanced Micro Devices |
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 CEOs Directory module to screen CEOs from public companies around the world.
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