Correlation Between UPI Semiconductor and Holtek Semiconductor

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

By analyzing existing cross correlation between uPI Semiconductor Corp and Holtek Semiconductor, you can compare the effects of market volatilities on UPI Semiconductor and Holtek 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 UPI Semiconductor with a short position of Holtek Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of UPI Semiconductor and Holtek Semiconductor.

Diversification Opportunities for UPI Semiconductor and Holtek Semiconductor

0.12

Correlation Coefficient

UPI Semiconductor  Holtek Semiconductor

Average diversification

The 3 months correlation between UPI and Holtek is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding uPI Semiconductor Corp and Holtek Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holtek Semiconductor and UPI Semiconductor 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 uPI Semiconductor Corp are associated (or correlated) with Holtek Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holtek Semiconductor has no effect on the direction of UPI Semiconductor i.e., UPI Semiconductor and Holtek Semiconductor go up and down completely randomly.

Pair Corralation between UPI Semiconductor and Holtek Semiconductor

Assuming the 90 days trading horizon uPI Semiconductor Corp is expected to under-perform the Holtek Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, uPI Semiconductor Corp is 1.16 times less risky than Holtek Semiconductor. The stock trades about -0.12 of its potential returns per unit of risk. The Holtek Semiconductor is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  4,755  in Holtek Semiconductor on December 28, 2024 and sell it today you would lose (55.00) from holding Holtek Semiconductor or give up 1.16% of portfolio value over 90 days.

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

uPI Semiconductor Corp  vs.  Holtek Semiconductor

uPI Semiconductor Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days uPI Semiconductor Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak 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.

Holtek Semiconductor

Risk-Adjusted Performance

Very Weak

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

Pair Trading with UPI Semiconductor and Holtek Semiconductor

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

The idea behind uPI Semiconductor Corp and Holtek Semiconductor 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.