Correlation Between Intchains Group and Ribbon Communications
Can any of the company-specific risk be diversified away by investing in both Intchains Group and Ribbon Communications 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 Ribbon Communications 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 Ribbon Communications, you can compare the effects of market volatilities on Intchains Group and Ribbon Communications 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 Ribbon Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intchains Group and Ribbon Communications.
Diversification Opportunities for Intchains Group and Ribbon Communications
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Intchains and Ribbon is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Intchains Group Limited and Ribbon Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ribbon Communications 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 Ribbon Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ribbon Communications has no effect on the direction of Intchains Group i.e., Intchains Group and Ribbon Communications go up and down completely randomly.
Pair Corralation between Intchains Group and Ribbon Communications
Considering the 90-day investment horizon Intchains Group Limited is expected to under-perform the Ribbon Communications. But the stock apears to be less risky and, when comparing its historical volatility, Intchains Group Limited is 1.43 times less risky than Ribbon Communications. The stock trades about -0.07 of its potential returns per unit of risk. The Ribbon Communications is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 343.00 in Ribbon Communications on August 24, 2024 and sell it today you would earn a total of 47.00 from holding Ribbon Communications or generate 13.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intchains Group Limited vs. Ribbon Communications
Performance |
| Timeline |
| Intchains Group |
| Ribbon Communications |
Intchains Group and Ribbon Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intchains Group and Ribbon Communications
The main advantage of trading using opposite Intchains Group and Ribbon Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intchains Group position performs unexpectedly, Ribbon Communications 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 Ribbon Communications will offset losses from the drop in Ribbon Communications' long position.| Intchains Group vs. Eshallgo Class A | Intchains Group vs. Amtech Systems | Intchains Group vs. Gold Fields Ltd | Intchains Group vs. Aegean Airlines SA |
| Ribbon Communications vs. ATN International | Ribbon Communications vs. Liberty Broadband Srs | Ribbon Communications vs. Cable One | Ribbon Communications vs. Consolidated Communications |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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