Correlation Between MaxLinear and Himax Technologies
Can any of the company-specific risk be diversified away by investing in both MaxLinear and Himax Technologies 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 MaxLinear and Himax Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MaxLinear and Himax Technologies, you can compare the effects of market volatilities on MaxLinear and Himax Technologies 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 MaxLinear with a short position of Himax Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of MaxLinear and Himax Technologies.
Diversification Opportunities for MaxLinear and Himax Technologies
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MaxLinear and Himax is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding MaxLinear and Himax Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Himax Technologies and MaxLinear 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 MaxLinear are associated (or correlated) with Himax Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Himax Technologies has no effect on the direction of MaxLinear i.e., MaxLinear and Himax Technologies go up and down completely randomly.
Pair Corralation between MaxLinear and Himax Technologies
Considering the 90-day investment horizon MaxLinear is expected to under-perform the Himax Technologies. In addition to that, MaxLinear is 1.26 times more volatile than Himax Technologies. It trades about 0.0 of its total potential returns per unit of risk. Himax Technologies is currently generating about 0.03 per unit of volatility. If you would invest 724.00 in Himax Technologies on October 21, 2024 and sell it today you would earn a total of 161.00 from holding Himax Technologies or generate 22.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MaxLinear vs. Himax Technologies
Performance |
| Timeline |
| MaxLinear |
| Himax Technologies |
MaxLinear and Himax Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MaxLinear and Himax Technologies
The main advantage of trading using opposite MaxLinear and Himax Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MaxLinear position performs unexpectedly, Himax Technologies 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 Himax Technologies will offset losses from the drop in Himax Technologies' long position.| MaxLinear vs. ASE Industrial Holding | MaxLinear vs. Himax Technologies | MaxLinear vs. United Microelectronics | MaxLinear vs. SemiLEDS |
| Himax Technologies vs. ASE Industrial Holding | Himax Technologies vs. United Microelectronics | Himax Technologies vs. MaxLinear | Himax Technologies vs. SemiLEDS |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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