Correlation Between Intel and Asia Broadband
Can any of the company-specific risk be diversified away by investing in both Intel and Asia Broadband 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 Intel and Asia Broadband into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel and Asia Broadband, you can compare the effects of market volatilities on Intel and Asia Broadband 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 Intel with a short position of Asia Broadband. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and Asia Broadband.
Diversification Opportunities for Intel and Asia Broadband
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Intel and Asia is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Intel and Asia Broadband in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Broadband and Intel 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 Intel are associated (or correlated) with Asia Broadband. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Broadband has no effect on the direction of Intel i.e., Intel and Asia Broadband go up and down completely randomly.
Pair Corralation between Intel and Asia Broadband
Given the investment horizon of 90 days Intel is expected to generate 4.28 times less return on investment than Asia Broadband. But when comparing it to its historical volatility, Intel is 2.13 times less risky than Asia Broadband. It trades about 0.0 of its potential returns per unit of risk. Asia Broadband is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 4.04 in Asia Broadband on September 3, 2024 and sell it today you would lose (1.77) from holding Asia Broadband or give up 43.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Intel vs. Asia Broadband
Performance |
| Timeline |
| Intel |
| Asia Broadband |
Intel and Asia Broadband Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intel and Asia Broadband
The main advantage of trading using opposite Intel and Asia Broadband positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel position performs unexpectedly, Asia Broadband 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 Asia Broadband will offset losses from the drop in Asia Broadband's long position.| Intel vs. NVIDIA | Intel vs. Taiwan Semiconductor Manufacturing | Intel vs. Marvell Technology Group | Intel vs. Micron Technology |
| Asia Broadband vs. Fury Gold Mines | Asia Broadband vs. Lion Copper and | Asia Broadband vs. Trilogy Metals | Asia Broadband vs. Western Copper and |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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