Correlation Between Intchains Group and Ams AG
Can any of the company-specific risk be diversified away by investing in both Intchains Group and Ams AG 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 Intchains Group and Ams AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intchains Group Limited and ams AG, you can compare the effects of market volatilities on Intchains Group and Ams AG 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 Intchains Group with a short position of Ams AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intchains Group and Ams AG.
Diversification Opportunities for Intchains Group and Ams AG
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Intchains and Ams is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Intchains Group Limited and ams AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ams AG and Intchains Group 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 Intchains Group Limited are associated (or correlated) with Ams AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ams AG has no effect on the direction of Intchains Group i.e., Intchains Group and Ams AG go up and down completely randomly.
Pair Corralation between Intchains Group and Ams AG
Considering the 90-day investment horizon Intchains Group Limited is expected to generate 0.23 times more return on investment than Ams AG. However, Intchains Group Limited is 4.44 times less risky than Ams AG. It trades about 0.02 of its potential returns per unit of risk. ams AG is currently generating about -0.22 per unit of risk. If you would invest 422.00 in Intchains Group Limited on August 29, 2024 and sell it today you would earn a total of 2.00 from holding Intchains Group Limited or generate 0.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intchains Group Limited vs. ams AG
Performance |
| Timeline |
| Intchains Group |
| ams AG |
Intchains Group and Ams AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intchains Group and Ams AG
The main advantage of trading using opposite Intchains Group and Ams AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intchains Group position performs unexpectedly, Ams AG 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 Ams AG will offset losses from the drop in Ams AG's long position.The idea behind Intchains Group Limited and ams AG pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Ams AG vs. NVIDIA | Ams AG vs. Intel | Ams AG vs. Taiwan Semiconductor Manufacturing | Ams AG vs. Marvell Technology Group |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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