Correlation Between SIVERS SEMICONDUCTORS and Fastenal

Can any of the company-specific risk be diversified away by investing in both SIVERS SEMICONDUCTORS and Fastenal 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 Fastenal 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 Fastenal Company, you can compare the effects of market volatilities on SIVERS SEMICONDUCTORS and Fastenal 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 Fastenal. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIVERS SEMICONDUCTORS and Fastenal.

Diversification Opportunities for SIVERS SEMICONDUCTORS and Fastenal

-0.73

Correlation Coefficient

SIVERS SEMICONDUCTORS  Fastenal

Pay attention - limited upside

The 3 months correlation between SIVERS and Fastenal is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding SIVERS SEMICONDUCTORS AB and Fastenal Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fastenal 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 Fastenal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fastenal has no effect on the direction of SIVERS SEMICONDUCTORS i.e., SIVERS SEMICONDUCTORS and Fastenal go up and down completely randomly.

Pair Corralation between SIVERS SEMICONDUCTORS and Fastenal

Assuming the 90 days horizon SIVERS SEMICONDUCTORS AB is expected to generate 3.49 times more return on investment than Fastenal. However, SIVERS SEMICONDUCTORS is 3.49 times more volatile than Fastenal Company. It trades about 0.12 of its potential returns per unit of risk. Fastenal Company is currently generating about 0.07 per unit of risk. If you would invest  25.00  in SIVERS SEMICONDUCTORS AB on October 24, 2024 and sell it today you would earn a total of  3.00  from holding SIVERS SEMICONDUCTORS AB or generate 12.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	94.44%
Values	Daily Returns

SIVERS SEMICONDUCTORS AB  vs.  Fastenal Company

SIVERS SEMICONDUCTORS

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SIVERS SEMICONDUCTORS AB are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, SIVERS SEMICONDUCTORS reported solid returns over the last few months and may actually be approaching a breakup point.

Fastenal

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Fastenal Company are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Fastenal may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with SIVERS SEMICONDUCTORS and Fastenal

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

The idea behind SIVERS SEMICONDUCTORS AB and Fastenal Company 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..