Correlation Between MagnaChip Semiconductor and Intel
Can any of the company-specific risk be diversified away by investing in both MagnaChip Semiconductor and Intel 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 Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MagnaChip Semiconductor and Intel, you can compare the effects of market volatilities on MagnaChip Semiconductor and Intel 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 Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of MagnaChip Semiconductor and Intel.
Diversification Opportunities for MagnaChip Semiconductor and Intel
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between MagnaChip and Intel is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding MagnaChip Semiconductor and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel 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 Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of MagnaChip Semiconductor i.e., MagnaChip Semiconductor and Intel go up and down completely randomly.
Pair Corralation between MagnaChip Semiconductor and Intel
Allowing for the 90-day total investment horizon MagnaChip Semiconductor is expected to under-perform the Intel. In addition to that, MagnaChip Semiconductor is 1.07 times more volatile than Intel. It trades about -0.05 of its total potential returns per unit of risk. Intel is currently generating about -0.01 per unit of volatility. If you would invest 2,292 in Intel on October 26, 2024 and sell it today you would lose (106.00) from holding Intel or give up 4.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MagnaChip Semiconductor vs. Intel
Performance |
| Timeline |
| MagnaChip Semiconductor |
| Intel |
MagnaChip Semiconductor and Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MagnaChip Semiconductor and Intel
The main advantage of trading using opposite MagnaChip Semiconductor and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MagnaChip Semiconductor position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.| MagnaChip Semiconductor vs. CEVA Inc | MagnaChip Semiconductor vs. MACOM Technology Solutions | MagnaChip Semiconductor vs. FormFactor | MagnaChip Semiconductor vs. MaxLinear |
| Intel vs. Diodes Incorporated | Intel vs. Daqo New Energy | Intel vs. Micron Technology | Intel vs. MagnaChip Semiconductor |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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