Correlation Between Cohu and Indie Semiconductor
Can any of the company-specific risk be diversified away by investing in both Cohu and Indie 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 Cohu and Indie Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cohu Inc and indie Semiconductor, you can compare the effects of market volatilities on Cohu and Indie 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 Cohu with a short position of Indie Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohu and Indie Semiconductor.
Diversification Opportunities for Cohu and Indie Semiconductor
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Cohu and Indie is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Cohu Inc and indie Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on indie Semiconductor and Cohu 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 Cohu Inc are associated (or correlated) with Indie Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of indie Semiconductor has no effect on the direction of Cohu i.e., Cohu and Indie Semiconductor go up and down completely randomly.
Pair Corralation between Cohu and Indie Semiconductor
Given the investment horizon of 90 days Cohu Inc is expected to under-perform the Indie Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Cohu Inc is 1.51 times less risky than Indie Semiconductor. The stock trades about -0.35 of its potential returns per unit of risk. The indie Semiconductor is currently generating about -0.16 of returns per unit of risk over similar time horizon. If you would invest 466.00 in indie Semiconductor on November 5, 2024 and sell it today you would lose (56.00) from holding indie Semiconductor or give up 12.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cohu Inc vs. indie Semiconductor
Performance |
| Timeline |
| Cohu Inc |
| indie Semiconductor |
Cohu and Indie Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cohu and Indie Semiconductor
The main advantage of trading using opposite Cohu and Indie Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cohu position performs unexpectedly, Indie 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 Indie Semiconductor will offset losses from the drop in Indie Semiconductor's long position.| Cohu vs. Onto Innovation | Cohu vs. Photronics | Cohu vs. Ultra Clean Holdings | Cohu vs. Axcelis Technologies |
| Indie Semiconductor vs. Axcelis Technologies | Indie Semiconductor vs. inTest | Indie Semiconductor vs. Lam Research Corp | Indie Semiconductor vs. Photronics |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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