Correlation Between SEALSQ Corp and MagnaChip Semiconductor
Can any of the company-specific risk be diversified away by investing in both SEALSQ Corp and MagnaChip Semiconductor 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 SEALSQ Corp and MagnaChip Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEALSQ Corp and MagnaChip Semiconductor, you can compare the effects of market volatilities on SEALSQ Corp and MagnaChip Semiconductor 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 SEALSQ Corp with a short position of MagnaChip Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEALSQ Corp and MagnaChip Semiconductor.
Diversification Opportunities for SEALSQ Corp and MagnaChip Semiconductor
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SEALSQ and MagnaChip is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding SEALSQ Corp and MagnaChip Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MagnaChip Semiconductor and SEALSQ Corp 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 SEALSQ Corp are associated (or correlated) with MagnaChip Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MagnaChip Semiconductor has no effect on the direction of SEALSQ Corp i.e., SEALSQ Corp and MagnaChip Semiconductor go up and down completely randomly.
Pair Corralation between SEALSQ Corp and MagnaChip Semiconductor
Given the investment horizon of 90 days SEALSQ Corp is expected to under-perform the MagnaChip Semiconductor. In addition to that, SEALSQ Corp is 2.98 times more volatile than MagnaChip Semiconductor. It trades about -0.06 of its total potential returns per unit of risk. MagnaChip Semiconductor is currently generating about -0.04 per unit of volatility. If you would invest 517.00 in MagnaChip Semiconductor on September 3, 2024 and sell it today you would lose (85.00) from holding MagnaChip Semiconductor or give up 16.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SEALSQ Corp vs. MagnaChip Semiconductor
Performance |
| Timeline |
| SEALSQ Corp |
| MagnaChip Semiconductor |
SEALSQ Corp and MagnaChip Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEALSQ Corp and MagnaChip Semiconductor
The main advantage of trading using opposite SEALSQ Corp and MagnaChip Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEALSQ Corp position performs unexpectedly, MagnaChip Semiconductor 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 MagnaChip Semiconductor will offset losses from the drop in MagnaChip Semiconductor's long position.| SEALSQ Corp vs. MagnaChip Semiconductor | SEALSQ Corp vs. Corporacion America Airports | SEALSQ Corp vs. Air Lease | SEALSQ Corp vs. Grupo Aeroportuario del |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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