Correlation Between MagnaChip Semiconductor and ATRYS HEALTH
Can any of the company-specific risk be diversified away by investing in both MagnaChip Semiconductor and ATRYS HEALTH 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 ATRYS HEALTH 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 ATRYS HEALTH SA, you can compare the effects of market volatilities on MagnaChip Semiconductor and ATRYS HEALTH 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 ATRYS HEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of MagnaChip Semiconductor and ATRYS HEALTH.
Diversification Opportunities for MagnaChip Semiconductor and ATRYS HEALTH
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MagnaChip and ATRYS is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding MagnaChip Semiconductor Corp and ATRYS HEALTH SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATRYS HEALTH SA 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 ATRYS HEALTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATRYS HEALTH SA has no effect on the direction of MagnaChip Semiconductor i.e., MagnaChip Semiconductor and ATRYS HEALTH go up and down completely randomly.
Pair Corralation between MagnaChip Semiconductor and ATRYS HEALTH
Assuming the 90 days trading horizon MagnaChip Semiconductor Corp is expected to generate 1.19 times more return on investment than ATRYS HEALTH. However, MagnaChip Semiconductor is 1.19 times more volatile than ATRYS HEALTH SA. It trades about -0.03 of its potential returns per unit of risk. ATRYS HEALTH SA is currently generating about -0.07 per unit of risk. If you would invest 458.00 in MagnaChip Semiconductor Corp on September 1, 2024 and sell it today you would lose (60.00) from holding MagnaChip Semiconductor Corp or give up 13.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MagnaChip Semiconductor Corp vs. ATRYS HEALTH SA
Performance |
| Timeline |
| MagnaChip Semiconductor |
| ATRYS HEALTH SA |
MagnaChip Semiconductor and ATRYS HEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MagnaChip Semiconductor and ATRYS HEALTH
The main advantage of trading using opposite MagnaChip Semiconductor and ATRYS HEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MagnaChip Semiconductor position performs unexpectedly, ATRYS HEALTH 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 ATRYS HEALTH will offset losses from the drop in ATRYS HEALTH's long position.| MagnaChip Semiconductor vs. Cardinal Health | MagnaChip Semiconductor vs. SMA Solar Technology | MagnaChip Semiconductor vs. Ramsay Health Care | MagnaChip Semiconductor vs. AECOM TECHNOLOGY |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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