Correlation Between Titan Machinery and Amkor Technology
Can any of the company-specific risk be diversified away by investing in both Titan Machinery and Amkor Technology 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 Titan Machinery and Amkor Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Titan Machinery and Amkor Technology, you can compare the effects of market volatilities on Titan Machinery and Amkor Technology 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 Titan Machinery with a short position of Amkor Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Titan Machinery and Amkor Technology.
Diversification Opportunities for Titan Machinery and Amkor Technology
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Titan and Amkor is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Titan Machinery and Amkor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amkor Technology and Titan Machinery 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 Titan Machinery are associated (or correlated) with Amkor Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amkor Technology has no effect on the direction of Titan Machinery i.e., Titan Machinery and Amkor Technology go up and down completely randomly.
Pair Corralation between Titan Machinery and Amkor Technology
Given the investment horizon of 90 days Titan Machinery is expected to generate 1.94 times more return on investment than Amkor Technology. However, Titan Machinery is 1.94 times more volatile than Amkor Technology. It trades about 0.14 of its potential returns per unit of risk. Amkor Technology is currently generating about 0.06 per unit of risk. If you would invest 1,381 in Titan Machinery on September 5, 2024 and sell it today you would earn a total of 150.00 from holding Titan Machinery or generate 10.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Titan Machinery vs. Amkor Technology
Performance |
| Timeline |
| Titan Machinery |
| Amkor Technology |
Titan Machinery and Amkor Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Titan Machinery and Amkor Technology
The main advantage of trading using opposite Titan Machinery and Amkor Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Titan Machinery position performs unexpectedly, Amkor Technology 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 Amkor Technology will offset losses from the drop in Amkor Technology's long position.| Titan Machinery vs. DXP Enterprises | Titan Machinery vs. Watsco Inc | Titan Machinery vs. Distribution Solutions Group | Titan Machinery vs. SiteOne Landscape Supply |
| Amkor Technology vs. NXP Semiconductors NV | Amkor Technology vs. Monolithic Power Systems | Amkor Technology vs. ON Semiconductor | Amkor Technology vs. GSI Technology |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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