Correlation Between Micron Technology and Mint
Can any of the company-specific risk be diversified away by investing in both Micron Technology and Mint 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 Mint into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Micron Technology and The Mint, you can compare the effects of market volatilities on Micron Technology and Mint 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 Mint. Check out your portfolio center. Please also check ongoing floating volatility patterns of Micron Technology and Mint.
Diversification Opportunities for Micron Technology and Mint
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Micron and Mint is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Micron Technology and The Mint in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mint 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 Mint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mint has no effect on the direction of Micron Technology i.e., Micron Technology and Mint go up and down completely randomly.
Pair Corralation between Micron Technology and Mint
Allowing for the 90-day total investment horizon Micron Technology is expected to under-perform the Mint. But the stock apears to be less risky and, when comparing its historical volatility, Micron Technology is 110.67 times less risky than Mint. The stock trades about -0.06 of its potential returns per unit of risk. The The Mint is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 1.85 in The Mint on September 13, 2024 and sell it today you would lose (0.65) from holding The Mint or give up 35.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.73% |
| Values | Daily Returns |
Micron Technology vs. The Mint
Performance |
| Timeline |
| Micron Technology |
| Mint |
Micron Technology and Mint Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Micron Technology and Mint
The main advantage of trading using opposite Micron Technology and Mint positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Micron Technology position performs unexpectedly, Mint 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 Mint will offset losses from the drop in Mint's long position.| Micron Technology vs. NVIDIA | Micron Technology vs. Intel | Micron Technology vs. Taiwan Semiconductor Manufacturing | Micron Technology vs. Marvell Technology Group |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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