Correlation Between Micron Technology and Amkor Technology
Can any of the company-specific risk be diversified away by investing in both Micron Technology 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 Micron Technology and Amkor Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Micron Technology and Amkor Technology, you can compare the effects of market volatilities on Micron Technology 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 Micron Technology with a short position of Amkor Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Micron Technology and Amkor Technology.
Diversification Opportunities for Micron Technology and Amkor Technology
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Micron and Amkor is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Micron Technology and Amkor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amkor Technology and Micron 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 Micron Technology 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 Micron Technology i.e., Micron Technology and Amkor Technology go up and down completely randomly.
Pair Corralation between Micron Technology and Amkor Technology
Allowing for the 90-day total investment horizon Micron Technology is expected to generate 1.25 times more return on investment than Amkor Technology. However, Micron Technology is 1.25 times more volatile than Amkor Technology. It trades about 0.03 of its potential returns per unit of risk. Amkor Technology is currently generating about -0.12 per unit of risk. If you would invest 9,613 in Micron Technology on August 30, 2024 and sell it today you would earn a total of 207.00 from holding Micron Technology or generate 2.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Micron Technology vs. Amkor Technology
Performance |
| Timeline |
| Micron Technology |
| Amkor Technology |
Micron Technology and Amkor Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Micron Technology and Amkor Technology
The main advantage of trading using opposite Micron Technology and Amkor Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Micron Technology 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.| Micron Technology vs. NVIDIA | Micron Technology vs. Intel | Micron Technology vs. Taiwan Semiconductor Manufacturing | Micron Technology vs. Marvell Technology Group |
| Amkor Technology vs. Power Integrations | Amkor Technology vs. Diodes Incorporated | Amkor Technology vs. MACOM Technology Solutions | Amkor Technology vs. Cirrus Logic |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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