Correlation Between MACOM Technology and WASION GROUP

Can any of the company-specific risk be diversified away by investing in both MACOM Technology and WASION GROUP 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 MACOM Technology and WASION GROUP into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MACOM Technology Solutions and WASION GROUP HLDGS, you can compare the effects of market volatilities on MACOM Technology and WASION GROUP 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 MACOM Technology with a short position of WASION GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of MACOM Technology and WASION GROUP.

Diversification Opportunities for MACOM Technology and WASION GROUP

0.0

Correlation Coefficient

MACOM Technology  WASION GROUP

Pay attention - limited upside

The 3 months correlation between MACOM and WASION is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding MACOM Technology Solutions and WASION GROUP HLDGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WASION GROUP HLDGS and MACOM Technology 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 MACOM Technology Solutions are associated (or correlated) with WASION GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WASION GROUP HLDGS has no effect on the direction of MACOM Technology i.e., MACOM Technology and WASION GROUP go up and down completely randomly.

Pair Corralation between MACOM Technology and WASION GROUP

If you would invest  28.00  in WASION GROUP HLDGS on December 29, 2024 and sell it today you would earn a total of  0.00  from holding WASION GROUP HLDGS or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

MACOM Technology Solutions  vs.  WASION GROUP HLDGS

MACOM Technology Sol

Risk-Adjusted Performance

Very Weak

Over the last 90 days MACOM Technology Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

WASION GROUP HLDGS

Risk-Adjusted Performance

Very Weak

Over the last 90 days WASION GROUP HLDGS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, WASION GROUP is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with MACOM Technology and WASION GROUP

The main advantage of trading using opposite MACOM Technology and WASION GROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MACOM Technology position performs unexpectedly, WASION GROUP 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 WASION GROUP will offset losses from the drop in WASION GROUP's long position.

The idea behind MACOM Technology Solutions and WASION GROUP HLDGS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.