Correlation Between MACOM Technology and 05565AAN3
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By analyzing existing cross correlation between MACOM Technology Solutions and BNP 7375, you can compare the effects of market volatilities on MACOM Technology and 05565AAN3 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 MACOM Technology with a short position of 05565AAN3. Check out your portfolio center. Please also check ongoing floating volatility patterns of MACOM Technology and 05565AAN3.
Diversification Opportunities for MACOM Technology and 05565AAN3
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MACOM and 05565AAN3 is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding MACOM Technology Solutions and BNP 7375 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 05565AAN3 and MACOM Technology 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 MACOM Technology Solutions are associated (or correlated) with 05565AAN3. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 05565AAN3 has no effect on the direction of MACOM Technology i.e., MACOM Technology and 05565AAN3 go up and down completely randomly.
Pair Corralation between MACOM Technology and 05565AAN3
Given the investment horizon of 90 days MACOM Technology Solutions is expected to generate 1.99 times more return on investment than 05565AAN3. However, MACOM Technology is 1.99 times more volatile than BNP 7375. It trades about 0.07 of its potential returns per unit of risk. BNP 7375 is currently generating about 0.01 per unit of risk. If you would invest 6,894 in MACOM Technology Solutions on September 2, 2024 and sell it today you would earn a total of 6,388 from holding MACOM Technology Solutions or generate 92.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 22.18% |
| Values | Daily Returns |
MACOM Technology Solutions vs. BNP 7375
Performance |
| Timeline |
| MACOM Technology Sol |
| 05565AAN3 |
MACOM Technology and 05565AAN3 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MACOM Technology and 05565AAN3
The main advantage of trading using opposite MACOM Technology and 05565AAN3 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MACOM Technology position performs unexpectedly, 05565AAN3 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 05565AAN3 will offset losses from the drop in 05565AAN3's long position.| MACOM Technology vs. NXP Semiconductors NV | MACOM Technology vs. GSI Technology | MACOM Technology vs. MaxLinear | MACOM Technology vs. Texas Instruments Incorporated |
| 05565AAN3 vs. Sandstorm Gold Ltd | 05565AAN3 vs. IPG Photonics | 05565AAN3 vs. MACOM Technology Solutions | 05565AAN3 vs. Advanced Micro Devices |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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