Correlation Between SGH Old and MagnaChip Semiconductor
Can any of the company-specific risk be diversified away by investing in both SGH Old and MagnaChip Semiconductor 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 SGH Old and MagnaChip Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SGH Old and MagnaChip Semiconductor, you can compare the effects of market volatilities on SGH Old and MagnaChip Semiconductor 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 SGH Old with a short position of MagnaChip Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of SGH Old and MagnaChip Semiconductor.
Diversification Opportunities for SGH Old and MagnaChip Semiconductor
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SGH and MagnaChip is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding SGH Old and MagnaChip Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MagnaChip Semiconductor and SGH Old 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 SGH Old are associated (or correlated) with MagnaChip Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MagnaChip Semiconductor has no effect on the direction of SGH Old i.e., SGH Old and MagnaChip Semiconductor go up and down completely randomly.
Pair Corralation between SGH Old and MagnaChip Semiconductor
If you would invest 387.00 in MagnaChip Semiconductor on October 21, 2024 and sell it today you would earn a total of 29.00 from holding MagnaChip Semiconductor or generate 7.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 5.26% |
| Values | Daily Returns |
SGH Old vs. MagnaChip Semiconductor
Performance |
| Timeline |
| SGH Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| MagnaChip Semiconductor |
SGH Old and MagnaChip Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SGH Old and MagnaChip Semiconductor
The main advantage of trading using opposite SGH Old and MagnaChip Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SGH Old position performs unexpectedly, MagnaChip Semiconductor 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 MagnaChip Semiconductor will offset losses from the drop in MagnaChip Semiconductor's long position.| SGH Old vs. Silicon Motion Technology | SGH Old vs. MACOM Technology Solutions | SGH Old vs. Semtech | SGH Old vs. Alpha and Omega |
| MagnaChip Semiconductor vs. CEVA Inc | MagnaChip Semiconductor vs. MACOM Technology Solutions | MagnaChip Semiconductor vs. FormFactor | MagnaChip Semiconductor vs. MaxLinear |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |