Correlation Between Freight Technologies and MACOM Technology
Can any of the company-specific risk be diversified away by investing in both Freight Technologies and MACOM 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 Freight Technologies and MACOM Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Freight Technologies and MACOM Technology Solutions, you can compare the effects of market volatilities on Freight Technologies and MACOM 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 Freight Technologies with a short position of MACOM Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Freight Technologies and MACOM Technology.
Diversification Opportunities for Freight Technologies and MACOM Technology
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Freight and MACOM is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Freight Technologies and MACOM Technology Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MACOM Technology Sol and Freight Technologies 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 Freight Technologies are associated (or correlated) with MACOM Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MACOM Technology Sol has no effect on the direction of Freight Technologies i.e., Freight Technologies and MACOM Technology go up and down completely randomly.
Pair Corralation between Freight Technologies and MACOM Technology
Given the investment horizon of 90 days Freight Technologies is expected to generate 1.16 times more return on investment than MACOM Technology. However, Freight Technologies is 1.16 times more volatile than MACOM Technology Solutions. It trades about -0.01 of its potential returns per unit of risk. MACOM Technology Solutions is currently generating about -0.19 per unit of risk. If you would invest 136.00 in Freight Technologies on November 18, 2024 and sell it today you would lose (4.00) from holding Freight Technologies or give up 2.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Freight Technologies vs. MACOM Technology Solutions
Performance |
| Timeline |
| Freight Technologies |
| MACOM Technology Sol |
Freight Technologies and MACOM Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Freight Technologies and MACOM Technology
The main advantage of trading using opposite Freight Technologies and MACOM Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Freight Technologies position performs unexpectedly, MACOM 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 MACOM Technology will offset losses from the drop in MACOM Technology's long position.| Freight Technologies vs. Infobird Co | Freight Technologies vs. HeartCore Enterprises | Freight Technologies vs. CXApp Inc | Freight Technologies vs. Quhuo |
| MACOM Technology vs. Power Integrations | MACOM Technology vs. Diodes Incorporated | MACOM Technology vs. Cirrus Logic | MACOM Technology vs. Amkor Technology |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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