Correlation Between Intel and KLA Tencor
Can any of the company-specific risk be diversified away by investing in both Intel and KLA Tencor 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 KLA Tencor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel and KLA Tencor, you can compare the effects of market volatilities on Intel and KLA Tencor 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 KLA Tencor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and KLA Tencor.
Diversification Opportunities for Intel and KLA Tencor
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Intel and KLA is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Intel and KLA Tencor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KLA Tencor 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 KLA Tencor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KLA Tencor has no effect on the direction of Intel i.e., Intel and KLA Tencor go up and down completely randomly.
Pair Corralation between Intel and KLA Tencor
Given the investment horizon of 90 days Intel is expected to generate 1.85 times more return on investment than KLA Tencor. However, Intel is 1.85 times more volatile than KLA Tencor. It trades about 0.06 of its potential returns per unit of risk. KLA Tencor is currently generating about -0.22 per unit of risk. If you would invest 2,290 in Intel on August 30, 2024 and sell it today you would earn a total of 75.00 from holding Intel or generate 3.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intel vs. KLA Tencor
Performance |
| Timeline |
| Intel |
| KLA Tencor |
Intel and KLA Tencor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intel and KLA Tencor
The main advantage of trading using opposite Intel and KLA Tencor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel position performs unexpectedly, KLA Tencor 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 KLA Tencor will offset losses from the drop in KLA Tencor's long position.| Intel vs. ABIVAX Socit Anonyme | Intel vs. Morningstar Unconstrained Allocation | Intel vs. SPACE | Intel vs. Knife River |
| KLA Tencor vs. Applied Materials | KLA Tencor vs. ASML Holding NV | KLA Tencor vs. Axcelis Technologies | KLA Tencor vs. Teradyne |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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