Correlation Between CNH Industrial and Amkor Technology
Can any of the company-specific risk be diversified away by investing in both CNH Industrial 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 CNH Industrial and Amkor Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CNH Industrial NV and Amkor Technology, you can compare the effects of market volatilities on CNH Industrial 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 CNH Industrial with a short position of Amkor Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNH Industrial and Amkor Technology.
Diversification Opportunities for CNH Industrial and Amkor Technology
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CNH and Amkor is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding CNH Industrial NV and Amkor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amkor Technology and CNH Industrial 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 CNH Industrial NV 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 CNH Industrial i.e., CNH Industrial and Amkor Technology go up and down completely randomly.
Pair Corralation between CNH Industrial and Amkor Technology
Considering the 90-day investment horizon CNH Industrial NV is expected to generate 1.34 times more return on investment than Amkor Technology. However, CNH Industrial is 1.34 times more volatile than Amkor Technology. It trades about 0.23 of its potential returns per unit of risk. Amkor Technology is currently generating about 0.03 per unit of risk. If you would invest 1,072 in CNH Industrial NV on September 12, 2024 and sell it today you would earn a total of 134.00 from holding CNH Industrial NV or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
CNH Industrial NV vs. Amkor Technology
Performance |
| Timeline |
| CNH Industrial NV |
| Amkor Technology |
CNH Industrial and Amkor Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CNH Industrial and Amkor Technology
The main advantage of trading using opposite CNH Industrial and Amkor Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CNH Industrial 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.| CNH Industrial vs. Nyxoah | CNH Industrial vs. Merit Medical Systems | CNH Industrial vs. Monster Beverage Corp | CNH Industrial vs. Ambev SA ADR |
| 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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