Correlation Between Intel and Intchains Group
Can any of the company-specific risk be diversified away by investing in both Intel and Intchains 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 Intchains Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel and Intchains Group Limited, you can compare the effects of market volatilities on Intel and Intchains 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 Intchains Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and Intchains Group.
Diversification Opportunities for Intel and Intchains Group
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Intel and Intchains is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Intel and Intchains Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intchains Group 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 Intchains Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intchains Group has no effect on the direction of Intel i.e., Intel and Intchains Group go up and down completely randomly.
Pair Corralation between Intel and Intchains Group
Given the investment horizon of 90 days Intel is expected to generate 0.58 times more return on investment than Intchains Group. However, Intel is 1.72 times less risky than Intchains Group. It trades about -0.03 of its potential returns per unit of risk. Intchains Group Limited is currently generating about -0.05 per unit of risk. If you would invest 3,086 in Intel on August 25, 2024 and sell it today you would lose (636.00) from holding Intel or give up 20.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intel vs. Intchains Group Limited
Performance |
| Timeline |
| Intel |
| Intchains Group |
Intel and Intchains Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intel and Intchains Group
The main advantage of trading using opposite Intel and Intchains Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel position performs unexpectedly, Intchains 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 Intchains Group will offset losses from the drop in Intchains Group's long position.The idea behind Intel and Intchains Group Limited 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.| Intchains Group vs. Teradyne | Intchains Group vs. Veeco Instruments | Intchains Group vs. IPG Photonics | Intchains Group vs. Applied Materials |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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