Correlation Between MaxLinear and United Microelectronics
Can any of the company-specific risk be diversified away by investing in both MaxLinear and United Microelectronics 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 United Microelectronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MaxLinear and United Microelectronics, you can compare the effects of market volatilities on MaxLinear and United Microelectronics 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 United Microelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of MaxLinear and United Microelectronics.
Diversification Opportunities for MaxLinear and United Microelectronics
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MaxLinear and United is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding MaxLinear and United Microelectronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Microelectronics 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 United Microelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Microelectronics has no effect on the direction of MaxLinear i.e., MaxLinear and United Microelectronics go up and down completely randomly.
Pair Corralation between MaxLinear and United Microelectronics
Considering the 90-day investment horizon MaxLinear is expected to under-perform the United Microelectronics. In addition to that, MaxLinear is 2.15 times more volatile than United Microelectronics. It trades about -0.02 of its total potential returns per unit of risk. United Microelectronics is currently generating about 0.01 per unit of volatility. If you would invest 636.00 in United Microelectronics on August 31, 2024 and sell it today you would earn a total of 33.00 from holding United Microelectronics or generate 5.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MaxLinear vs. United Microelectronics
Performance |
| Timeline |
| MaxLinear |
| United Microelectronics |
MaxLinear and United Microelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MaxLinear and United Microelectronics
The main advantage of trading using opposite MaxLinear and United Microelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MaxLinear position performs unexpectedly, United Microelectronics 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 United Microelectronics will offset losses from the drop in United Microelectronics' long position.| MaxLinear vs. ASE Industrial Holding | MaxLinear vs. Himax Technologies | MaxLinear vs. United Microelectronics | MaxLinear vs. SemiLEDS |
| United Microelectronics vs. Silicon Motion Technology | United Microelectronics vs. ASE Industrial Holding | United Microelectronics vs. ChipMOS Technologies | United Microelectronics 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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