Correlation Between Intel and Capital Group
Can any of the company-specific risk be diversified away by investing in both Intel and Capital Group 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 Capital Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel and Capital Group Core, you can compare the effects of market volatilities on Intel and Capital Group 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 Capital Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and Capital Group.
Diversification Opportunities for Intel and Capital Group
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Intel and Capital is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Intel and Capital Group Core in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Group Core 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 Capital Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Group Core has no effect on the direction of Intel i.e., Intel and Capital Group go up and down completely randomly.
Pair Corralation between Intel and Capital Group
Given the investment horizon of 90 days Intel is expected to generate 12.22 times more return on investment than Capital Group. However, Intel is 12.22 times more volatile than Capital Group Core. It trades about 0.15 of its potential returns per unit of risk. Capital Group Core is currently generating about -0.07 per unit of risk. If you would invest 2,198 in Intel on August 24, 2024 and sell it today you would earn a total of 239.00 from holding Intel or generate 10.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Intel vs. Capital Group Core
Performance |
| Timeline |
| Intel |
| Capital Group Core |
Intel and Capital Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intel and Capital Group
The main advantage of trading using opposite Intel and Capital Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel position performs unexpectedly, Capital Group 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 Capital Group will offset losses from the drop in Capital Group's long position.| Intel vs. Eshallgo Class A | Intel vs. Amtech Systems | Intel vs. Gold Fields Ltd | Intel vs. Aegean Airlines SA |
| Capital Group vs. Capital Group Dividend | Capital Group vs. Capital Group Core | Capital Group vs. Capital Group Growth | Capital Group vs. Capital Group Global |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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