Correlation Between FormFactor and SGH Old
Can any of the company-specific risk be diversified away by investing in both FormFactor and SGH Old 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 FormFactor and SGH Old into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FormFactor and SGH Old, you can compare the effects of market volatilities on FormFactor and SGH Old 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 FormFactor with a short position of SGH Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of FormFactor and SGH Old.
Diversification Opportunities for FormFactor and SGH Old
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FormFactor and SGH is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FormFactor and SGH Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SGH Old and FormFactor 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 FormFactor are associated (or correlated) with SGH Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SGH Old has no effect on the direction of FormFactor i.e., FormFactor and SGH Old go up and down completely randomly.
Pair Corralation between FormFactor and SGH Old
Given the investment horizon of 90 days FormFactor is expected to generate 1.34 times less return on investment than SGH Old. But when comparing it to its historical volatility, FormFactor is 1.31 times less risky than SGH Old. It trades about 0.03 of its potential returns per unit of risk. SGH Old is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,773 in SGH Old on November 2, 2024 and sell it today you would earn a total of 268.00 from holding SGH Old or generate 15.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 85.43% |
| Values | Daily Returns |
FormFactor vs. SGH Old
Performance |
| Timeline |
| FormFactor |
| SGH Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
FormFactor and SGH Old Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FormFactor and SGH Old
The main advantage of trading using opposite FormFactor and SGH Old positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FormFactor position performs unexpectedly, SGH Old 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 SGH Old will offset losses from the drop in SGH Old's long position.| FormFactor vs. Silicon Laboratories | FormFactor vs. Diodes Incorporated | FormFactor vs. MACOM Technology Solutions | FormFactor vs. Amkor Technology |
| SGH Old vs. Silicon Motion Technology | SGH Old vs. MACOM Technology Solutions | SGH Old vs. Semtech | SGH Old vs. Alpha and Omega |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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