Correlation Between Valens and CEVA
Can any of the company-specific risk be diversified away by investing in both Valens and CEVA 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 Valens and CEVA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Valens and CEVA Inc, you can compare the effects of market volatilities on Valens and CEVA 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 Valens with a short position of CEVA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valens and CEVA.
Diversification Opportunities for Valens and CEVA
Very good diversification
The 3 months correlation between Valens and CEVA is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Valens and CEVA Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CEVA Inc and Valens 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 Valens are associated (or correlated) with CEVA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CEVA Inc has no effect on the direction of Valens i.e., Valens and CEVA go up and down completely randomly.
Pair Corralation between Valens and CEVA
Considering the 90-day investment horizon Valens is expected to under-perform the CEVA. In addition to that, Valens is 1.18 times more volatile than CEVA Inc. It trades about -0.03 of its total potential returns per unit of risk. CEVA Inc is currently generating about 0.02 per unit of volatility. If you would invest 2,629 in CEVA Inc on August 24, 2024 and sell it today you would earn a total of 238.00 from holding CEVA Inc or generate 9.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valens vs. CEVA Inc
Performance |
| Timeline |
| Valens |
| CEVA Inc |
Valens and CEVA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valens and CEVA
The main advantage of trading using opposite Valens and CEVA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valens position performs unexpectedly, CEVA 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 CEVA will offset losses from the drop in CEVA's long position.| Valens vs. Wolfspeed | Valens vs. GSI Technology | Valens vs. Lattice Semiconductor | Valens vs. ON Semiconductor |
| CEVA vs. MagnaChip Semiconductor | CEVA vs. MACOM Technology Solutions | CEVA vs. FormFactor | CEVA vs. MaxLinear |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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