Correlation Between Iteris and Silicom
Can any of the company-specific risk be diversified away by investing in both Iteris and Silicom 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 Iteris and Silicom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Iteris Inc and Silicom, you can compare the effects of market volatilities on Iteris and Silicom 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 Iteris with a short position of Silicom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iteris and Silicom.
Diversification Opportunities for Iteris and Silicom
Weak diversification
The 3 months correlation between Iteris and Silicom is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Iteris Inc and Silicom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silicom and Iteris 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 Iteris Inc are associated (or correlated) with Silicom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silicom has no effect on the direction of Iteris i.e., Iteris and Silicom go up and down completely randomly.
Pair Corralation between Iteris and Silicom
Considering the 90-day investment horizon Iteris Inc is expected to generate 36.01 times more return on investment than Silicom. However, Iteris is 36.01 times more volatile than Silicom. It trades about 0.1 of its potential returns per unit of risk. Silicom is currently generating about -0.05 per unit of risk. If you would invest 443.00 in Iteris Inc on September 2, 2024 and sell it today you would earn a total of 26,206 from holding Iteris Inc or generate 5915.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 88.1% |
| Values | Daily Returns |
Iteris Inc vs. Silicom
Performance |
| Timeline |
| Iteris Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
| Silicom |
Iteris and Silicom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Iteris and Silicom
The main advantage of trading using opposite Iteris and Silicom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Iteris position performs unexpectedly, Silicom 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 Silicom will offset losses from the drop in Silicom's long position.| Iteris vs. Optical Cable | Iteris vs. KVH Industries | Iteris vs. Knowles Cor | Iteris vs. Comtech Telecommunications Corp |
| Silicom vs. Ituran Location and | Silicom vs. Sapiens International | Silicom vs. Allot Communications | Silicom vs. Radcom |
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 Stocks Directory module to find actively traded stocks across global markets.
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