Correlation Between Kulicke and Cebu Air
Can any of the company-specific risk be diversified away by investing in both Kulicke and Cebu Air 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 Kulicke and Cebu Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kulicke and Soffa and Cebu Air ADR, you can compare the effects of market volatilities on Kulicke and Cebu Air 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 Kulicke with a short position of Cebu Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kulicke and Cebu Air.
Diversification Opportunities for Kulicke and Cebu Air
Pay attention - limited upside
The 3 months correlation between Kulicke and Cebu is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Kulicke and Soffa and Cebu Air ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cebu Air ADR and Kulicke 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 Kulicke and Soffa are associated (or correlated) with Cebu Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cebu Air ADR has no effect on the direction of Kulicke i.e., Kulicke and Cebu Air go up and down completely randomly.
Pair Corralation between Kulicke and Cebu Air
Given the investment horizon of 90 days Kulicke and Soffa is expected to generate 0.7 times more return on investment than Cebu Air. However, Kulicke and Soffa is 1.44 times less risky than Cebu Air. It trades about 0.02 of its potential returns per unit of risk. Cebu Air ADR is currently generating about -0.02 per unit of risk. If you would invest 4,336 in Kulicke and Soffa on September 12, 2024 and sell it today you would earn a total of 548.00 from holding Kulicke and Soffa or generate 12.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kulicke and Soffa vs. Cebu Air ADR
Performance |
| Timeline |
| Kulicke and Soffa |
| Cebu Air ADR |
Kulicke and Cebu Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kulicke and Cebu Air
The main advantage of trading using opposite Kulicke and Cebu Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kulicke position performs unexpectedly, Cebu Air 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 Cebu Air will offset losses from the drop in Cebu Air's long position.The idea behind Kulicke and Soffa and Cebu Air ADR 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.| Cebu Air vs. Finnair Oyj | Cebu Air vs. easyJet plc | Cebu Air vs. Norse Atlantic ASA | Cebu Air vs. Air New Zealand |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |