Correlation Between Silicon Motion and HOCHSCHILD MINING
Can any of the company-specific risk be diversified away by investing in both Silicon Motion and HOCHSCHILD MINING 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 Silicon Motion and HOCHSCHILD MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Silicon Motion Technology and HOCHSCHILD MINING, you can compare the effects of market volatilities on Silicon Motion and HOCHSCHILD MINING 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 Silicon Motion with a short position of HOCHSCHILD MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Silicon Motion and HOCHSCHILD MINING.
Diversification Opportunities for Silicon Motion and HOCHSCHILD MINING
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Silicon and HOCHSCHILD is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Silicon Motion Technology and HOCHSCHILD MINING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HOCHSCHILD MINING and Silicon Motion 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 Silicon Motion Technology are associated (or correlated) with HOCHSCHILD MINING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HOCHSCHILD MINING has no effect on the direction of Silicon Motion i.e., Silicon Motion and HOCHSCHILD MINING go up and down completely randomly.
Pair Corralation between Silicon Motion and HOCHSCHILD MINING
Assuming the 90 days trading horizon Silicon Motion Technology is expected to under-perform the HOCHSCHILD MINING. But the stock apears to be less risky and, when comparing its historical volatility, Silicon Motion Technology is 1.49 times less risky than HOCHSCHILD MINING. The stock trades about -0.02 of its potential returns per unit of risk. The HOCHSCHILD MINING is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 238.00 in HOCHSCHILD MINING on August 28, 2024 and sell it today you would earn a total of 12.00 from holding HOCHSCHILD MINING or generate 5.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Silicon Motion Technology vs. HOCHSCHILD MINING
Performance |
| Timeline |
| Silicon Motion Technology |
| HOCHSCHILD MINING |
Silicon Motion and HOCHSCHILD MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Silicon Motion and HOCHSCHILD MINING
The main advantage of trading using opposite Silicon Motion and HOCHSCHILD MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Silicon Motion position performs unexpectedly, HOCHSCHILD MINING 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 HOCHSCHILD MINING will offset losses from the drop in HOCHSCHILD MINING's long position.| Silicon Motion vs. Apple Inc | Silicon Motion vs. Apple Inc | Silicon Motion vs. Apple Inc | Silicon Motion vs. Apple Inc |
| HOCHSCHILD MINING vs. Brockhaus Capital Management | HOCHSCHILD MINING vs. Hisense Home Appliances | HOCHSCHILD MINING vs. 24SEVENOFFICE GROUP AB | HOCHSCHILD MINING vs. Jupiter Fund Management |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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