Correlation Between Elmos Semiconductor and AdCapital
Can any of the company-specific risk be diversified away by investing in both Elmos Semiconductor and AdCapital 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 Elmos Semiconductor and AdCapital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elmos Semiconductor SE and AdCapital AG, you can compare the effects of market volatilities on Elmos Semiconductor and AdCapital 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 Elmos Semiconductor with a short position of AdCapital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elmos Semiconductor and AdCapital.
Diversification Opportunities for Elmos Semiconductor and AdCapital
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Elmos and AdCapital is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Elmos Semiconductor SE and AdCapital AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AdCapital AG and Elmos Semiconductor 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 Elmos Semiconductor SE are associated (or correlated) with AdCapital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AdCapital AG has no effect on the direction of Elmos Semiconductor i.e., Elmos Semiconductor and AdCapital go up and down completely randomly.
Pair Corralation between Elmos Semiconductor and AdCapital
Assuming the 90 days trading horizon Elmos Semiconductor is expected to generate 1.8 times less return on investment than AdCapital. But when comparing it to its historical volatility, Elmos Semiconductor SE is 1.37 times less risky than AdCapital. It trades about 0.03 of its potential returns per unit of risk. AdCapital AG is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 136.00 in AdCapital AG on November 3, 2024 and sell it today you would earn a total of 29.00 from holding AdCapital AG or generate 21.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elmos Semiconductor SE vs. AdCapital AG
Performance |
| Timeline |
| Elmos Semiconductor |
| AdCapital AG |
Elmos Semiconductor and AdCapital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elmos Semiconductor and AdCapital
The main advantage of trading using opposite Elmos Semiconductor and AdCapital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elmos Semiconductor position performs unexpectedly, AdCapital 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 AdCapital will offset losses from the drop in AdCapital's long position.| Elmos Semiconductor vs. NVIDIA | Elmos Semiconductor vs. NVIDIA | Elmos Semiconductor vs. Taiwan Semiconductor Manufacturing | Elmos Semiconductor vs. Texas Instruments Incorporated |
| AdCapital vs. Grupo Carso SAB | AdCapital vs. ecotel communication ag | AdCapital vs. INTERNET INJPADR 1 | AdCapital vs. Cars Inc |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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