Correlation Between SIVERS SEMICONDUCTORS and Bosideng International

Can any of the company-specific risk be diversified away by investing in both SIVERS SEMICONDUCTORS and Bosideng International 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 SIVERS SEMICONDUCTORS and Bosideng International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SIVERS SEMICONDUCTORS AB and Bosideng International Holdings, you can compare the effects of market volatilities on SIVERS SEMICONDUCTORS and Bosideng International 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 SIVERS SEMICONDUCTORS with a short position of Bosideng International. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIVERS SEMICONDUCTORS and Bosideng International.

Diversification Opportunities for SIVERS SEMICONDUCTORS and Bosideng International

0.11

Correlation Coefficient

SIVERS SEMICONDUCTORS  Bosideng International

Average diversification

The 3 months correlation between SIVERS and Bosideng is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding SIVERS SEMICONDUCTORS AB and Bosideng International Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bosideng International and SIVERS SEMICONDUCTORS 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 SIVERS SEMICONDUCTORS AB are associated (or correlated) with Bosideng International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bosideng International has no effect on the direction of SIVERS SEMICONDUCTORS i.e., SIVERS SEMICONDUCTORS and Bosideng International go up and down completely randomly.

Pair Corralation between SIVERS SEMICONDUCTORS and Bosideng International

Assuming the 90 days horizon SIVERS SEMICONDUCTORS AB is expected to generate 2.05 times more return on investment than Bosideng International. However, SIVERS SEMICONDUCTORS is 2.05 times more volatile than Bosideng International Holdings. It trades about 0.08 of its potential returns per unit of risk. Bosideng International Holdings is currently generating about 0.03 per unit of risk. If you would invest  28.00  in SIVERS SEMICONDUCTORS AB on December 24, 2024 and sell it today you would earn a total of  7.00  from holding SIVERS SEMICONDUCTORS AB or generate 25.0% return on investment over 90 days.

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

SIVERS SEMICONDUCTORS AB  vs.  Bosideng International Holding

SIVERS SEMICONDUCTORS

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SIVERS SEMICONDUCTORS AB are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, SIVERS SEMICONDUCTORS reported solid returns over the last few months and may actually be approaching a breakup point.

Bosideng International

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Bosideng International Holdings are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Bosideng International is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with SIVERS SEMICONDUCTORS and Bosideng International

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

The idea behind SIVERS SEMICONDUCTORS AB and Bosideng International Holdings 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.