Correlation Between MagnaChip Semiconductor and Corporate Travel
Can any of the company-specific risk be diversified away by investing in both MagnaChip Semiconductor and Corporate Travel 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 MagnaChip Semiconductor and Corporate Travel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MagnaChip Semiconductor Corp and Corporate Travel Management, you can compare the effects of market volatilities on MagnaChip Semiconductor and Corporate Travel 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 MagnaChip Semiconductor with a short position of Corporate Travel. Check out your portfolio center. Please also check ongoing floating volatility patterns of MagnaChip Semiconductor and Corporate Travel.
Diversification Opportunities for MagnaChip Semiconductor and Corporate Travel
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MagnaChip and Corporate is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding MagnaChip Semiconductor Corp and Corporate Travel Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corporate Travel Man and MagnaChip 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 MagnaChip Semiconductor Corp are associated (or correlated) with Corporate Travel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corporate Travel Man has no effect on the direction of MagnaChip Semiconductor i.e., MagnaChip Semiconductor and Corporate Travel go up and down completely randomly.
Pair Corralation between MagnaChip Semiconductor and Corporate Travel
Assuming the 90 days trading horizon MagnaChip Semiconductor Corp is expected to under-perform the Corporate Travel. In addition to that, MagnaChip Semiconductor is 1.37 times more volatile than Corporate Travel Management. It trades about -0.25 of its total potential returns per unit of risk. Corporate Travel Management is currently generating about 0.31 per unit of volatility. If you would invest 695.00 in Corporate Travel Management on August 24, 2024 and sell it today you would earn a total of 155.00 from holding Corporate Travel Management or generate 22.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MagnaChip Semiconductor Corp vs. Corporate Travel Management
Performance |
| Timeline |
| MagnaChip Semiconductor |
| Corporate Travel Man |
MagnaChip Semiconductor and Corporate Travel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MagnaChip Semiconductor and Corporate Travel
The main advantage of trading using opposite MagnaChip Semiconductor and Corporate Travel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MagnaChip Semiconductor position performs unexpectedly, Corporate Travel 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 Corporate Travel will offset losses from the drop in Corporate Travel's long position.| MagnaChip Semiconductor vs. Coeur Mining | MagnaChip Semiconductor vs. Evolution Mining Limited | MagnaChip Semiconductor vs. Dairy Farm International | MagnaChip Semiconductor vs. Beyond Meat |
| Corporate Travel vs. EPSILON HEALTHCARE LTD | Corporate Travel vs. Ramsay Health Care | Corporate Travel vs. Bumrungrad Hospital Public | Corporate Travel vs. MGIC INVESTMENT |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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