Correlation Between APEX International and Syntek Semiconductor

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

By analyzing existing cross correlation between APEX International Financial and Syntek Semiconductor Co, you can compare the effects of market volatilities on APEX International and Syntek Semiconductor 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 APEX International with a short position of Syntek Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of APEX International and Syntek Semiconductor.

Diversification Opportunities for APEX International and Syntek Semiconductor

0.27

Correlation Coefficient

APEX International  Syntek Semiconductor

Modest diversification

The 3 months correlation between APEX and Syntek is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding APEX International Financial and Syntek Semiconductor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Syntek Semiconductor and APEX International 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 APEX International Financial are associated (or correlated) with Syntek Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Syntek Semiconductor has no effect on the direction of APEX International i.e., APEX International and Syntek Semiconductor go up and down completely randomly.

Pair Corralation between APEX International and Syntek Semiconductor

Assuming the 90 days trading horizon APEX International Financial is expected to under-perform the Syntek Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, APEX International Financial is 1.38 times less risky than Syntek Semiconductor. The stock trades about -0.14 of its potential returns per unit of risk. The Syntek Semiconductor Co is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  986.00  in Syntek Semiconductor Co on December 23, 2024 and sell it today you would lose (27.00) from holding Syntek Semiconductor Co or give up 2.74% of portfolio value over 90 days.

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

APEX International Financial  vs.  Syntek Semiconductor Co

APEX International

Risk-Adjusted Performance

Very Weak

Over the last 90 days APEX International Financial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Syntek Semiconductor

Risk-Adjusted Performance

Very Weak

Over the last 90 days Syntek Semiconductor Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Syntek Semiconductor is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with APEX International and Syntek Semiconductor

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

The idea behind APEX International Financial and Syntek Semiconductor Co 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.