Correlation Between Emerson Radio and Amkor Technology
Can any of the company-specific risk be diversified away by investing in both Emerson Radio and Amkor Technology 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 Emerson Radio and Amkor Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Emerson Radio and Amkor Technology, you can compare the effects of market volatilities on Emerson Radio and Amkor Technology 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 Emerson Radio with a short position of Amkor Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerson Radio and Amkor Technology.
Diversification Opportunities for Emerson Radio and Amkor Technology
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Emerson and Amkor is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Emerson Radio and Amkor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amkor Technology and Emerson Radio 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 Emerson Radio are associated (or correlated) with Amkor Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amkor Technology has no effect on the direction of Emerson Radio i.e., Emerson Radio and Amkor Technology go up and down completely randomly.
Pair Corralation between Emerson Radio and Amkor Technology
Considering the 90-day investment horizon Emerson Radio is expected to generate 3.19 times less return on investment than Amkor Technology. In addition to that, Emerson Radio is 1.18 times more volatile than Amkor Technology. It trades about 0.0 of its total potential returns per unit of risk. Amkor Technology is currently generating about 0.01 per unit of volatility. If you would invest 2,662 in Amkor Technology on November 6, 2024 and sell it today you would lose (201.00) from holding Amkor Technology or give up 7.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Emerson Radio vs. Amkor Technology
Performance |
| Timeline |
| Emerson Radio |
| Amkor Technology |
Emerson Radio and Amkor Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Emerson Radio and Amkor Technology
The main advantage of trading using opposite Emerson Radio and Amkor Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Emerson Radio position performs unexpectedly, Amkor Technology 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 Amkor Technology will offset losses from the drop in Amkor Technology's long position.| Emerson Radio vs. VOXX International | Emerson Radio vs. LG Display Co | Emerson Radio vs. Koss Corporation | Emerson Radio vs. Wearable Devices |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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