Correlation Between Silicom and Comtech Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both Silicom and Comtech Telecommunicatio 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 Silicom and Comtech Telecommunicatio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Silicom and Comtech Telecommunications Corp, you can compare the effects of market volatilities on Silicom and Comtech Telecommunicatio 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 Silicom with a short position of Comtech Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Silicom and Comtech Telecommunicatio.
Diversification Opportunities for Silicom and Comtech Telecommunicatio
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Silicom and Comtech is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Silicom and Comtech Telecommunications Cor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comtech Telecommunicatio and Silicom 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 Silicom are associated (or correlated) with Comtech Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comtech Telecommunicatio has no effect on the direction of Silicom i.e., Silicom and Comtech Telecommunicatio go up and down completely randomly.
Pair Corralation between Silicom and Comtech Telecommunicatio
Given the investment horizon of 90 days Silicom is expected to generate 0.41 times more return on investment than Comtech Telecommunicatio. However, Silicom is 2.42 times less risky than Comtech Telecommunicatio. It trades about -0.04 of its potential returns per unit of risk. Comtech Telecommunications Corp is currently generating about -0.03 per unit of risk. If you would invest 3,898 in Silicom on November 1, 2024 and sell it today you would lose (2,129) from holding Silicom or give up 54.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Silicom vs. Comtech Telecommunications Cor
Performance |
| Timeline |
| Silicom |
| Comtech Telecommunicatio |
Silicom and Comtech Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Silicom and Comtech Telecommunicatio
The main advantage of trading using opposite Silicom and Comtech Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Silicom position performs unexpectedly, Comtech Telecommunicatio 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 Comtech Telecommunicatio will offset losses from the drop in Comtech Telecommunicatio's long position.| Silicom vs. Ituran Location and | Silicom vs. Sapiens International | Silicom vs. Allot Communications | Silicom vs. Radcom |
| Comtech Telecommunicatio vs. KVH Industries | Comtech Telecommunicatio vs. Aviat Networks | Comtech Telecommunicatio vs. Harmonic | Comtech Telecommunicatio vs. Telesat Corp |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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