Correlation Between ON Semiconductor and STMicroelectronics
Can any of the company-specific risk be diversified away by investing in both ON Semiconductor and STMicroelectronics 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 ON Semiconductor and STMicroelectronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ON Semiconductor and STMicroelectronics NV, you can compare the effects of market volatilities on ON Semiconductor and STMicroelectronics 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 ON Semiconductor with a short position of STMicroelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of ON Semiconductor and STMicroelectronics.
Diversification Opportunities for ON Semiconductor and STMicroelectronics
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between O2NS34 and STMicroelectronics is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding ON Semiconductor and STMicroelectronics NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STMicroelectronics and ON 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 ON Semiconductor are associated (or correlated) with STMicroelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STMicroelectronics has no effect on the direction of ON Semiconductor i.e., ON Semiconductor and STMicroelectronics go up and down completely randomly.
Pair Corralation between ON Semiconductor and STMicroelectronics
Assuming the 90 days trading horizon ON Semiconductor is expected to generate 5.56 times more return on investment than STMicroelectronics. However, ON Semiconductor is 5.56 times more volatile than STMicroelectronics NV. It trades about 0.33 of its potential returns per unit of risk. STMicroelectronics NV is currently generating about -0.21 per unit of risk. If you would invest 3,052 in ON Semiconductor on October 20, 2025 and sell it today you would earn a total of 1,079 from holding ON Semiconductor or generate 35.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.44% |
| Values | Daily Returns |
ON Semiconductor vs. STMicroelectronics NV
Performance |
| Timeline |
| ON Semiconductor |
| STMicroelectronics |
ON Semiconductor and STMicroelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ON Semiconductor and STMicroelectronics
The main advantage of trading using opposite ON Semiconductor and STMicroelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ON Semiconductor position performs unexpectedly, STMicroelectronics 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 STMicroelectronics will offset losses from the drop in STMicroelectronics' long position.| ON Semiconductor vs. Mitsubishi UFJ Financial | ON Semiconductor vs. Prudential Financial | ON Semiconductor vs. Credit Acceptance | ON Semiconductor vs. Jefferies Financial Group |
| STMicroelectronics vs. Teladoc Health | STMicroelectronics vs. Fidelity National Information | STMicroelectronics vs. Universal Health Services | STMicroelectronics vs. HCA Healthcare |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |