Correlation Between SIVERS SEMICONDUCTORS and BGF World

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

Diversification Opportunities for SIVERS SEMICONDUCTORS and BGF World

0.4

Correlation Coefficient

SIVERS SEMICONDUCTORS  BGF World

Very weak diversification

The 3 months correlation between SIVERS and BGF is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding SIVERS SEMICONDUCTORS AB and BGF World Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BGF World Gold 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 BGF World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BGF World Gold has no effect on the direction of SIVERS SEMICONDUCTORS i.e., SIVERS SEMICONDUCTORS and BGF World go up and down completely randomly.

Pair Corralation between SIVERS SEMICONDUCTORS and BGF World

Assuming the 90 days horizon SIVERS SEMICONDUCTORS AB is expected to generate 5.69 times more return on investment than BGF World. However, SIVERS SEMICONDUCTORS is 5.69 times more volatile than BGF World Gold. It trades about 0.02 of its potential returns per unit of risk. BGF World Gold is currently generating about -0.11 per unit of risk. If you would invest  30.00  in SIVERS SEMICONDUCTORS AB on October 6, 2024 and sell it today you would lose (5.00) from holding SIVERS SEMICONDUCTORS AB or give up 16.67% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	97.5%
Values	Daily Returns

SIVERS SEMICONDUCTORS AB  vs.  BGF World Gold

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 newest stock price disturbance, may contribute to mid-run losses for the stockholders.

BGF World Gold

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BGF World Gold has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the fund shareholders.

Pair Trading with SIVERS SEMICONDUCTORS and BGF World

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

The idea behind SIVERS SEMICONDUCTORS AB and BGF World Gold 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.