Correlation Between Pinterest and Amkor Technology
Can any of the company-specific risk be diversified away by investing in both Pinterest and Amkor Technology 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 Pinterest and Amkor Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pinterest and Amkor Technology, you can compare the effects of market volatilities on Pinterest and Amkor Technology 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 Pinterest with a short position of Amkor Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pinterest and Amkor Technology.
Diversification Opportunities for Pinterest and Amkor Technology
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Pinterest and Amkor is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Pinterest and Amkor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amkor Technology and Pinterest 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 Pinterest are associated (or correlated) with Amkor Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amkor Technology has no effect on the direction of Pinterest i.e., Pinterest and Amkor Technology go up and down completely randomly.
Pair Corralation between Pinterest and Amkor Technology
Given the investment horizon of 90 days Pinterest is expected to generate 0.98 times more return on investment than Amkor Technology. However, Pinterest is 1.02 times less risky than Amkor Technology. It trades about 0.03 of its potential returns per unit of risk. Amkor Technology is currently generating about 0.02 per unit of risk. If you would invest 2,316 in Pinterest on August 30, 2024 and sell it today you would earn a total of 716.00 from holding Pinterest or generate 30.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pinterest vs. Amkor Technology
Performance |
| Timeline |
| Amkor Technology |
Pinterest and Amkor Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pinterest and Amkor Technology
The main advantage of trading using opposite Pinterest and Amkor Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pinterest position performs unexpectedly, Amkor Technology 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 Amkor Technology will offset losses from the drop in Amkor Technology's long position.| Pinterest vs. Twilio Inc | Pinterest vs. Meta Platforms | Pinterest vs. Alphabet Inc Class C | Pinterest vs. Alphabet Inc Class A |
| Amkor Technology vs. Power Integrations | Amkor Technology vs. Diodes Incorporated | Amkor Technology vs. MACOM Technology Solutions | Amkor Technology vs. Cirrus Logic |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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