Correlation Between X FAB and MICRONIC MYDATA
Can any of the company-specific risk be diversified away by investing in both X FAB and MICRONIC MYDATA 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 X FAB and MICRONIC MYDATA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between X FAB Silicon Foundries and MICRONIC MYDATA, you can compare the effects of market volatilities on X FAB and MICRONIC MYDATA 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 X FAB with a short position of MICRONIC MYDATA. Check out your portfolio center. Please also check ongoing floating volatility patterns of X FAB and MICRONIC MYDATA.
Diversification Opportunities for X FAB and MICRONIC MYDATA
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between XFB and MICRONIC is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding X FAB Silicon Foundries and MICRONIC MYDATA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MICRONIC MYDATA and X FAB 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 X FAB Silicon Foundries are associated (or correlated) with MICRONIC MYDATA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MICRONIC MYDATA has no effect on the direction of X FAB i.e., X FAB and MICRONIC MYDATA go up and down completely randomly.
Pair Corralation between X FAB and MICRONIC MYDATA
Assuming the 90 days trading horizon X FAB is expected to generate 4.46 times less return on investment than MICRONIC MYDATA. In addition to that, X FAB is 1.38 times more volatile than MICRONIC MYDATA. It trades about 0.02 of its total potential returns per unit of risk. MICRONIC MYDATA is currently generating about 0.14 per unit of volatility. If you would invest 3,500 in MICRONIC MYDATA on October 18, 2024 and sell it today you would earn a total of 172.00 from holding MICRONIC MYDATA or generate 4.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
X FAB Silicon Foundries vs. MICRONIC MYDATA
Performance |
| Timeline |
| X FAB Silicon |
| MICRONIC MYDATA |
X FAB and MICRONIC MYDATA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with X FAB and MICRONIC MYDATA
The main advantage of trading using opposite X FAB and MICRONIC MYDATA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if X FAB position performs unexpectedly, MICRONIC MYDATA 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 MICRONIC MYDATA will offset losses from the drop in MICRONIC MYDATA's long position.| X FAB vs. Gaztransport Technigaz SA | X FAB vs. SCIENCE IN SPORT | X FAB vs. Air Transport Services | X FAB vs. Fukuyama Transporting Co |
| MICRONIC MYDATA vs. AIR PRODCHEMICALS | MICRONIC MYDATA vs. X FAB Silicon Foundries | MICRONIC MYDATA vs. SILICON LABORATOR | MICRONIC MYDATA vs. Sunstone Hotel Investors |
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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