Correlation Between Infineon Technologies and BrainChip Holdings
Can any of the company-specific risk be diversified away by investing in both Infineon Technologies and BrainChip Holdings 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 Infineon Technologies and BrainChip Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Infineon Technologies AG and BrainChip Holdings, you can compare the effects of market volatilities on Infineon Technologies and BrainChip Holdings 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 Infineon Technologies with a short position of BrainChip Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infineon Technologies and BrainChip Holdings.
Diversification Opportunities for Infineon Technologies and BrainChip Holdings
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Infineon and BrainChip is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Infineon Technologies AG and BrainChip Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BrainChip Holdings and Infineon 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 Infineon Technologies AG are associated (or correlated) with BrainChip Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BrainChip Holdings has no effect on the direction of Infineon Technologies i.e., Infineon Technologies and BrainChip Holdings go up and down completely randomly.
Pair Corralation between Infineon Technologies and BrainChip Holdings
If you would invest 646.00 in BrainChip Holdings on August 29, 2024 and sell it today you would earn a total of 33.00 from holding BrainChip Holdings or generate 5.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 2.33% |
| Values | Daily Returns |
Infineon Technologies AG vs. BrainChip Holdings
Performance |
| Timeline |
| Infineon Technologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| BrainChip Holdings |
Infineon Technologies and BrainChip Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Infineon Technologies and BrainChip Holdings
The main advantage of trading using opposite Infineon Technologies and BrainChip Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Infineon Technologies position performs unexpectedly, BrainChip Holdings 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 BrainChip Holdings will offset losses from the drop in BrainChip Holdings' long position.| Infineon Technologies vs. Renesas Electronics | Infineon Technologies vs. Power Integrations | Infineon Technologies vs. Rohm Co Ltd | Infineon Technologies vs. MACOM Technology Solutions |
| BrainChip Holdings vs. Skywater Technology | BrainChip Holdings vs. Everspin Technologies | BrainChip Holdings vs. 4DS Memory Limited | BrainChip Holdings vs. Weebit Nano Limited |
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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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