Correlation Between MagnaChip Semiconductor and Kellogg
Can any of the company-specific risk be diversified away by investing in both MagnaChip Semiconductor and Kellogg 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 Kellogg 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 Kellogg Company, you can compare the effects of market volatilities on MagnaChip Semiconductor and Kellogg 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 Kellogg. Check out your portfolio center. Please also check ongoing floating volatility patterns of MagnaChip Semiconductor and Kellogg.
Diversification Opportunities for MagnaChip Semiconductor and Kellogg
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MagnaChip and Kellogg is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding MagnaChip Semiconductor Corp and Kellogg Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kellogg Company 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 Kellogg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kellogg Company has no effect on the direction of MagnaChip Semiconductor i.e., MagnaChip Semiconductor and Kellogg go up and down completely randomly.
Pair Corralation between MagnaChip Semiconductor and Kellogg
Assuming the 90 days trading horizon MagnaChip Semiconductor Corp is expected to under-perform the Kellogg. In addition to that, MagnaChip Semiconductor is 1.7 times more volatile than Kellogg Company. It trades about -0.06 of its total potential returns per unit of risk. Kellogg Company is currently generating about 0.05 per unit of volatility. If you would invest 5,861 in Kellogg Company on November 1, 2024 and sell it today you would earn a total of 1,957 from holding Kellogg Company or generate 33.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MagnaChip Semiconductor Corp vs. Kellogg Company
Performance |
| Timeline |
| MagnaChip Semiconductor |
| Kellogg Company |
MagnaChip Semiconductor and Kellogg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MagnaChip Semiconductor and Kellogg
The main advantage of trading using opposite MagnaChip Semiconductor and Kellogg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MagnaChip Semiconductor position performs unexpectedly, Kellogg 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 Kellogg will offset losses from the drop in Kellogg's long position.| MagnaChip Semiconductor vs. Norwegian Air Shuttle | MagnaChip Semiconductor vs. SEALED AIR | MagnaChip Semiconductor vs. NH HOTEL GROUP | MagnaChip Semiconductor vs. Choice Hotels International |
| Kellogg vs. MagnaChip Semiconductor Corp | Kellogg vs. Mitsubishi Materials | Kellogg vs. EAGLE MATERIALS | Kellogg vs. APPLIED MATERIALS |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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