Correlation Between Sumco Corp and Advantest Corp
Can any of the company-specific risk be diversified away by investing in both Sumco Corp and Advantest Corp 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 Sumco Corp and Advantest Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sumco Corp ADR and Advantest Corp DRC, you can compare the effects of market volatilities on Sumco Corp and Advantest Corp 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 Sumco Corp with a short position of Advantest Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sumco Corp and Advantest Corp.
Diversification Opportunities for Sumco Corp and Advantest Corp
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sumco and Advantest is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Sumco Corp ADR and Advantest Corp DRC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advantest Corp DRC and Sumco Corp 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 Sumco Corp ADR are associated (or correlated) with Advantest Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advantest Corp DRC has no effect on the direction of Sumco Corp i.e., Sumco Corp and Advantest Corp go up and down completely randomly.
Pair Corralation between Sumco Corp and Advantest Corp
If you would invest 1,475 in Sumco Corp ADR on November 3, 2024 and sell it today you would earn a total of 5.00 from holding Sumco Corp ADR or generate 0.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 5.0% |
| Values | Daily Returns |
Sumco Corp ADR vs. Advantest Corp DRC
Performance |
| Timeline |
| Sumco Corp ADR |
| Advantest Corp DRC |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Sumco Corp and Advantest Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sumco Corp and Advantest Corp
The main advantage of trading using opposite Sumco Corp and Advantest Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sumco Corp position performs unexpectedly, Advantest Corp 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 Advantest Corp will offset losses from the drop in Advantest Corp's long position.| Sumco Corp vs. Lasertec | Sumco Corp vs. Asm Pacific Technology | Sumco Corp vs. Disco Corp ADR | Sumco Corp vs. Tokyo Electron |
| Advantest Corp vs. Disco Corp ADR | Advantest Corp vs. Tokyo Electron | Advantest Corp vs. Lasertec | Advantest Corp vs. BE Semiconductor Industries |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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