Correlation Between SIVERS SEMICONDUCTORS and Templeton Global

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

Diversification Opportunities for SIVERS SEMICONDUCTORS and Templeton Global

0.35

Correlation Coefficient

SIVERS SEMICONDUCTORS  Templeton Global

Weak diversification

The 3 months correlation between SIVERS and Templeton is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding SIVERS SEMICONDUCTORS AB and Templeton Global Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Global Bond 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 Templeton Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Global Bond has no effect on the direction of SIVERS SEMICONDUCTORS i.e., SIVERS SEMICONDUCTORS and Templeton Global go up and down completely randomly.

Pair Corralation between SIVERS SEMICONDUCTORS and Templeton Global

Assuming the 90 days horizon SIVERS SEMICONDUCTORS AB is expected to generate 15.47 times more return on investment than Templeton Global. However, SIVERS SEMICONDUCTORS is 15.47 times more volatile than Templeton Global Bond. It trades about 0.01 of its potential returns per unit of risk. Templeton Global Bond is currently generating about -0.14 per unit of risk. If you would invest  33.00  in SIVERS SEMICONDUCTORS AB on October 6, 2024 and sell it today you would lose (7.00) from holding SIVERS SEMICONDUCTORS AB or give up 21.21% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	93.33%
Values	Daily Returns

SIVERS SEMICONDUCTORS AB  vs.  Templeton Global Bond

SIVERS SEMICONDUCTORS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SIVERS SEMICONDUCTORS AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, SIVERS SEMICONDUCTORS is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Templeton Global Bond

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Templeton Global Bond has generated negative risk-adjusted returns adding no value to fund investors. In spite of rather sound technical and fundamental indicators, Templeton Global is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with SIVERS SEMICONDUCTORS and Templeton Global

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

The idea behind SIVERS SEMICONDUCTORS AB and Templeton Global Bond 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 Transaction History module to view history of all your transactions and understand their impact on performance.