Correlation Between SIVERS SEMICONDUCTORS and Roper Technologies

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

Diversification Opportunities for SIVERS SEMICONDUCTORS and Roper Technologies

-0.63

Correlation Coefficient

SIVERS SEMICONDUCTORS  Roper Technologies

Excellent diversification

The 3 months correlation between SIVERS and Roper is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding SIVERS SEMICONDUCTORS AB and Roper Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Roper Technologies 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 Roper Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Roper Technologies has no effect on the direction of SIVERS SEMICONDUCTORS i.e., SIVERS SEMICONDUCTORS and Roper Technologies go up and down completely randomly.

Pair Corralation between SIVERS SEMICONDUCTORS and Roper Technologies

Assuming the 90 days horizon SIVERS SEMICONDUCTORS is expected to generate 33.56 times less return on investment than Roper Technologies. In addition to that, SIVERS SEMICONDUCTORS is 8.09 times more volatile than Roper Technologies. It trades about 0.0 of its total potential returns per unit of risk. Roper Technologies is currently generating about 0.16 per unit of volatility. If you would invest  49,538  in Roper Technologies on October 25, 2024 and sell it today you would earn a total of  1,142  from holding Roper Technologies or generate 2.31% return on investment over 90 days.

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

SIVERS SEMICONDUCTORS AB  vs.  Roper Technologies

SIVERS SEMICONDUCTORS

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SIVERS SEMICONDUCTORS AB are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, SIVERS SEMICONDUCTORS may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Roper Technologies

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Roper Technologies are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Roper Technologies 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 Roper Technologies

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

The idea behind SIVERS SEMICONDUCTORS AB and Roper Technologies 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.