Correlation Between Nordic Semiconductor and SIVERS SEMICONDUCTORS
Can any of the company-specific risk be diversified away by investing in both Nordic Semiconductor and SIVERS SEMICONDUCTORS 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 Nordic Semiconductor and SIVERS SEMICONDUCTORS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordic Semiconductor ASA and SIVERS SEMICONDUCTORS AB, you can compare the effects of market volatilities on Nordic Semiconductor and SIVERS SEMICONDUCTORS 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 Nordic Semiconductor with a short position of SIVERS SEMICONDUCTORS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordic Semiconductor and SIVERS SEMICONDUCTORS.
Diversification Opportunities for Nordic Semiconductor and SIVERS SEMICONDUCTORS
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nordic and SIVERS is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Nordic Semiconductor ASA and SIVERS SEMICONDUCTORS AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIVERS SEMICONDUCTORS and Nordic 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 Nordic Semiconductor ASA are associated (or correlated) with SIVERS SEMICONDUCTORS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIVERS SEMICONDUCTORS has no effect on the direction of Nordic Semiconductor i.e., Nordic Semiconductor and SIVERS SEMICONDUCTORS go up and down completely randomly.
Pair Corralation between Nordic Semiconductor and SIVERS SEMICONDUCTORS
Assuming the 90 days horizon Nordic Semiconductor ASA is expected to generate 0.17 times more return on investment than SIVERS SEMICONDUCTORS. However, Nordic Semiconductor ASA is 5.78 times less risky than SIVERS SEMICONDUCTORS. It trades about -0.21 of its potential returns per unit of risk. SIVERS SEMICONDUCTORS AB is currently generating about -0.16 per unit of risk. If you would invest 917.00 in Nordic Semiconductor ASA on August 29, 2024 and sell it today you would lose (86.00) from holding Nordic Semiconductor ASA or give up 9.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nordic Semiconductor ASA vs. SIVERS SEMICONDUCTORS AB
Performance |
| Timeline |
| Nordic Semiconductor ASA |
| SIVERS SEMICONDUCTORS |
Nordic Semiconductor and SIVERS SEMICONDUCTORS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordic Semiconductor and SIVERS SEMICONDUCTORS
The main advantage of trading using opposite Nordic Semiconductor and SIVERS SEMICONDUCTORS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordic Semiconductor position performs unexpectedly, SIVERS SEMICONDUCTORS 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 SIVERS SEMICONDUCTORS will offset losses from the drop in SIVERS SEMICONDUCTORS's long position.| Nordic Semiconductor vs. NVIDIA | Nordic Semiconductor vs. Taiwan Semiconductor Manufacturing | Nordic Semiconductor vs. Texas Instruments Incorporated | Nordic Semiconductor vs. Advanced Micro Devices |
| SIVERS SEMICONDUCTORS vs. ELMOS SEMICONDUCTOR | SIVERS SEMICONDUCTORS vs. NXP Semiconductors NV | SIVERS SEMICONDUCTORS vs. ON SEMICONDUCTOR | SIVERS SEMICONDUCTORS vs. Nordic Semiconductor ASA |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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