Correlation Between Elmos Semiconductor and Siltronic
Can any of the company-specific risk be diversified away by investing in both Elmos Semiconductor and Siltronic 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 Siltronic 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 Siltronic AG, you can compare the effects of market volatilities on Elmos Semiconductor and Siltronic 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 Siltronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elmos Semiconductor and Siltronic.
Diversification Opportunities for Elmos Semiconductor and Siltronic
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Elmos and Siltronic is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Elmos Semiconductor SE and Siltronic AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siltronic 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 Siltronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siltronic AG has no effect on the direction of Elmos Semiconductor i.e., Elmos Semiconductor and Siltronic go up and down completely randomly.
Pair Corralation between Elmos Semiconductor and Siltronic
Assuming the 90 days trading horizon Elmos Semiconductor SE is expected to under-perform the Siltronic. But the stock apears to be less risky and, when comparing its historical volatility, Elmos Semiconductor SE is 1.35 times less risky than Siltronic. The stock trades about -0.13 of its potential returns per unit of risk. The Siltronic AG is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 4,670 in Siltronic AG on November 5, 2024 and sell it today you would lose (240.00) from holding Siltronic AG or give up 5.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elmos Semiconductor SE vs. Siltronic AG
Performance |
| Timeline |
| Elmos Semiconductor |
| Siltronic AG |
Elmos Semiconductor and Siltronic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elmos Semiconductor and Siltronic
The main advantage of trading using opposite Elmos Semiconductor and Siltronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elmos Semiconductor position performs unexpectedly, Siltronic 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 Siltronic will offset losses from the drop in Siltronic's long position.| Elmos Semiconductor vs. WillScot Mobile Mini | Elmos Semiconductor vs. American Airlines Group | Elmos Semiconductor vs. Verizon Communications | Elmos Semiconductor vs. Gol Intelligent Airlines |
| Siltronic vs. NVIDIA | Siltronic vs. NVIDIA | Siltronic vs. Taiwan Semiconductor Manufacturing | Siltronic vs. Texas Instruments Incorporated |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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