Correlation Between MagnaChip Semiconductor and Stepstone
Can any of the company-specific risk be diversified away by investing in both MagnaChip Semiconductor and Stepstone 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 Stepstone into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MagnaChip Semiconductor and Stepstone Group, you can compare the effects of market volatilities on MagnaChip Semiconductor and Stepstone 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 Stepstone. Check out your portfolio center. Please also check ongoing floating volatility patterns of MagnaChip Semiconductor and Stepstone.
Diversification Opportunities for MagnaChip Semiconductor and Stepstone
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MagnaChip and Stepstone is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding MagnaChip Semiconductor and Stepstone Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stepstone Group 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 Stepstone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stepstone Group has no effect on the direction of MagnaChip Semiconductor i.e., MagnaChip Semiconductor and Stepstone go up and down completely randomly.
Pair Corralation between MagnaChip Semiconductor and Stepstone
Allowing for the 90-day total investment horizon MagnaChip Semiconductor is expected to under-perform the Stepstone. In addition to that, MagnaChip Semiconductor is 1.34 times more volatile than Stepstone Group. It trades about -0.04 of its total potential returns per unit of risk. Stepstone Group is currently generating about 0.11 per unit of volatility. If you would invest 6,195 in Stepstone Group on August 30, 2024 and sell it today you would earn a total of 409.00 from holding Stepstone Group or generate 6.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MagnaChip Semiconductor vs. Stepstone Group
Performance |
| Timeline |
| MagnaChip Semiconductor |
| Stepstone Group |
MagnaChip Semiconductor and Stepstone Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MagnaChip Semiconductor and Stepstone
The main advantage of trading using opposite MagnaChip Semiconductor and Stepstone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MagnaChip Semiconductor position performs unexpectedly, Stepstone 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 Stepstone will offset losses from the drop in Stepstone's long position.| MagnaChip Semiconductor vs. CEVA Inc | MagnaChip Semiconductor vs. MACOM Technology Solutions | MagnaChip Semiconductor vs. FormFactor | MagnaChip Semiconductor vs. MaxLinear |
| Stepstone vs. Munivest Fund | Stepstone vs. Blackrock Muniyield Quality | Stepstone vs. Federated Investors B | Stepstone vs. Federated Premier Municipal |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |