Correlation Between MagnaChip Semiconductor and GENTING SG
Can any of the company-specific risk be diversified away by investing in both MagnaChip Semiconductor and GENTING SG 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 GENTING SG 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 GENTING SG LTD, you can compare the effects of market volatilities on MagnaChip Semiconductor and GENTING SG 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 GENTING SG. Check out your portfolio center. Please also check ongoing floating volatility patterns of MagnaChip Semiconductor and GENTING SG.
Diversification Opportunities for MagnaChip Semiconductor and GENTING SG
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MagnaChip and GENTING is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding MagnaChip Semiconductor Corp and GENTING SG LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GENTING SG LTD 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 GENTING SG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GENTING SG LTD has no effect on the direction of MagnaChip Semiconductor i.e., MagnaChip Semiconductor and GENTING SG go up and down completely randomly.
Pair Corralation between MagnaChip Semiconductor and GENTING SG
Assuming the 90 days trading horizon MagnaChip Semiconductor Corp is expected to generate 1.09 times more return on investment than GENTING SG. However, MagnaChip Semiconductor is 1.09 times more volatile than GENTING SG LTD. It trades about 0.28 of its potential returns per unit of risk. GENTING SG LTD is currently generating about -0.07 per unit of risk. If you would invest 350.00 in MagnaChip Semiconductor Corp on September 5, 2024 and sell it today you would earn a total of 68.00 from holding MagnaChip Semiconductor Corp or generate 19.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MagnaChip Semiconductor Corp vs. GENTING SG LTD
Performance |
| Timeline |
| MagnaChip Semiconductor |
| GENTING SG LTD |
MagnaChip Semiconductor and GENTING SG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MagnaChip Semiconductor and GENTING SG
The main advantage of trading using opposite MagnaChip Semiconductor and GENTING SG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MagnaChip Semiconductor position performs unexpectedly, GENTING SG 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 GENTING SG will offset losses from the drop in GENTING SG's long position.| MagnaChip Semiconductor vs. Apple Inc | MagnaChip Semiconductor vs. Apple Inc | MagnaChip Semiconductor vs. Apple Inc | MagnaChip Semiconductor vs. Apple Inc |
| GENTING SG vs. Charter Communications | GENTING SG vs. MagnaChip Semiconductor Corp | GENTING SG vs. WillScot Mobile Mini | GENTING SG vs. Nordic Semiconductor ASA |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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