Correlation Between ON Semiconductor and Fluent
Can any of the company-specific risk be diversified away by investing in both ON Semiconductor and Fluent 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 Fluent into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ON Semiconductor and Fluent Inc, you can compare the effects of market volatilities on ON Semiconductor and Fluent 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 Fluent. Check out your portfolio center. Please also check ongoing floating volatility patterns of ON Semiconductor and Fluent.
Diversification Opportunities for ON Semiconductor and Fluent
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ON Semiconductor and Fluent is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding ON Semiconductor and Fluent Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fluent Inc 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 Fluent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fluent Inc has no effect on the direction of ON Semiconductor i.e., ON Semiconductor and Fluent go up and down completely randomly.
Pair Corralation between ON Semiconductor and Fluent
Allowing for the 90-day total investment horizon ON Semiconductor is expected to under-perform the Fluent. In addition to that, ON Semiconductor is 1.66 times more volatile than Fluent Inc. It trades about -0.11 of its total potential returns per unit of risk. Fluent Inc is currently generating about 0.12 per unit of volatility. If you would invest 223.00 in Fluent Inc on January 24, 2025 and sell it today you would earn a total of 21.00 from holding Fluent Inc or generate 9.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ON Semiconductor vs. Fluent Inc
Performance |
| Timeline |
| ON Semiconductor |
| Fluent Inc |
ON Semiconductor and Fluent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ON Semiconductor and Fluent
The main advantage of trading using opposite ON Semiconductor and Fluent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ON Semiconductor position performs unexpectedly, Fluent 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 Fluent will offset losses from the drop in Fluent's long position.| ON Semiconductor vs. Texas Instruments Incorporated | ON Semiconductor vs. Microchip Technology | ON Semiconductor vs. Analog Devices | ON Semiconductor vs. Qorvo Inc |
| Fluent vs. Marchex | Fluent vs. Dolphin Entertainment | Fluent vs. Beyond Commerce | Fluent vs. Impact Fusion International |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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