Correlation Between Amkor Technology and Blackline

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

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

Diversification Opportunities for Amkor Technology and Blackline

-0.61

Correlation Coefficient

Amkor Technology  Blackline

Excellent diversification

The 3 months correlation between Amkor and Blackline is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Amkor Technology and Blackline in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackline and Amkor Technology 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 Amkor Technology are associated (or correlated) with Blackline. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackline has no effect on the direction of Amkor Technology i.e., Amkor Technology and Blackline go up and down completely randomly.

Pair Corralation between Amkor Technology and Blackline

Assuming the 90 days horizon Amkor Technology is expected to under-perform the Blackline. In addition to that, Amkor Technology is 1.25 times more volatile than Blackline. It trades about -0.07 of its total potential returns per unit of risk. Blackline is currently generating about 0.1 per unit of volatility. If you would invest  5,800  in Blackline on September 28, 2024 and sell it today you would earn a total of  150.00  from holding Blackline or generate 2.59% return on investment over 90 days.

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

Amkor Technology  vs.  Blackline

Amkor Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amkor Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Blackline

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Blackline are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Blackline reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Amkor Technology and Blackline

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

The idea behind Amkor Technology and Blackline 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.