Correlation Between Logility Supply and MagnaChip Semiconductor
Can any of the company-specific risk be diversified away by investing in both Logility Supply 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 Logility Supply and MagnaChip Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Logility Supply Chain and MagnaChip Semiconductor, you can compare the effects of market volatilities on Logility Supply 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 Logility Supply with a short position of MagnaChip Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Logility Supply and MagnaChip Semiconductor.
Diversification Opportunities for Logility Supply and MagnaChip Semiconductor
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Logility and MagnaChip is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Logility Supply Chain and MagnaChip Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MagnaChip Semiconductor and Logility Supply 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 Logility Supply Chain 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 Logility Supply i.e., Logility Supply and MagnaChip Semiconductor go up and down completely randomly.
Pair Corralation between Logility Supply and MagnaChip Semiconductor
Given the investment horizon of 90 days Logility Supply Chain is expected to under-perform the MagnaChip Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Logility Supply Chain is 1.13 times less risky than MagnaChip Semiconductor. The stock trades about -0.07 of its potential returns per unit of risk. The MagnaChip Semiconductor is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 416.00 in MagnaChip Semiconductor on October 9, 2024 and sell it today you would earn a total of 2.00 from holding MagnaChip Semiconductor or generate 0.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Logility Supply Chain vs. MagnaChip Semiconductor
Performance |
| Timeline |
| Logility Supply Chain |
| MagnaChip Semiconductor |
Logility Supply and MagnaChip Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Logility Supply and MagnaChip Semiconductor
The main advantage of trading using opposite Logility Supply and MagnaChip Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Logility Supply 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.| Logility Supply vs. Western Midstream Partners | Logility Supply vs. Suburban Propane Partners | Logility Supply vs. Empresa Distribuidora y | Logility Supply vs. Ameriprise Financial |
| MagnaChip Semiconductor vs. CEVA Inc | MagnaChip Semiconductor vs. MACOM Technology Solutions | MagnaChip Semiconductor vs. FormFactor | MagnaChip Semiconductor vs. MaxLinear |
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 CEOs Directory module to screen CEOs from public companies around the world.
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