Correlation Between MagnaChip Semiconductor and Entegris
Can any of the company-specific risk be diversified away by investing in both MagnaChip Semiconductor and Entegris 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 MagnaChip Semiconductor and Entegris into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MagnaChip Semiconductor and Entegris, you can compare the effects of market volatilities on MagnaChip Semiconductor and Entegris 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 MagnaChip Semiconductor with a short position of Entegris. Check out your portfolio center. Please also check ongoing floating volatility patterns of MagnaChip Semiconductor and Entegris.
Diversification Opportunities for MagnaChip Semiconductor and Entegris
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MagnaChip and Entegris is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding MagnaChip Semiconductor and Entegris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Entegris and MagnaChip Semiconductor 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 MagnaChip Semiconductor are associated (or correlated) with Entegris. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Entegris has no effect on the direction of MagnaChip Semiconductor i.e., MagnaChip Semiconductor and Entegris go up and down completely randomly.
Pair Corralation between MagnaChip Semiconductor and Entegris
Allowing for the 90-day total investment horizon MagnaChip Semiconductor is expected to generate 1.64 times more return on investment than Entegris. However, MagnaChip Semiconductor is 1.64 times more volatile than Entegris. It trades about 0.33 of its potential returns per unit of risk. Entegris is currently generating about 0.1 per unit of risk. If you would invest 402.00 in MagnaChip Semiconductor on November 28, 2024 and sell it today you would earn a total of 100.00 from holding MagnaChip Semiconductor or generate 24.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MagnaChip Semiconductor vs. Entegris
Performance |
| Timeline |
| MagnaChip Semiconductor |
| Entegris |
MagnaChip Semiconductor and Entegris Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MagnaChip Semiconductor and Entegris
The main advantage of trading using opposite MagnaChip Semiconductor and Entegris positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MagnaChip Semiconductor position performs unexpectedly, Entegris 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 Entegris will offset losses from the drop in Entegris' long position.| MagnaChip Semiconductor vs. CEVA Inc | MagnaChip Semiconductor vs. MACOM Technology Solutions | MagnaChip Semiconductor vs. FormFactor | MagnaChip Semiconductor vs. MaxLinear |
| Entegris vs. Teradyne | Entegris vs. Ichor Holdings | Entegris vs. Amtech Systems | Entegris vs. Veeco Instruments |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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