Correlation Between Amkor Technology and LQR House
Can any of the company-specific risk be diversified away by investing in both Amkor Technology and LQR House 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 LQR House into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amkor Technology and LQR House, you can compare the effects of market volatilities on Amkor Technology and LQR House 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 LQR House. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amkor Technology and LQR House.
Diversification Opportunities for Amkor Technology and LQR House
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Amkor and LQR is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Amkor Technology and LQR House in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LQR House 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 LQR House. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LQR House has no effect on the direction of Amkor Technology i.e., Amkor Technology and LQR House go up and down completely randomly.
Pair Corralation between Amkor Technology and LQR House
Given the investment horizon of 90 days Amkor Technology is expected to under-perform the LQR House. But the stock apears to be less risky and, when comparing its historical volatility, Amkor Technology is 4.04 times less risky than LQR House. The stock trades about -0.15 of its potential returns per unit of risk. The LQR House is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 163.00 in LQR House on December 18, 2024 and sell it today you would earn a total of 49.00 from holding LQR House or generate 30.06% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Amkor Technology vs. LQR House
Performance |
Timeline |
Amkor Technology |
LQR House |
Amkor Technology and LQR House Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Amkor Technology and LQR House
The main advantage of trading using opposite Amkor Technology and LQR House positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amkor Technology position performs unexpectedly, LQR House 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 LQR House will offset losses from the drop in LQR House's long position.Amkor Technology vs. Power Integrations | Amkor Technology vs. Diodes Incorporated | Amkor Technology vs. MACOM Technology Solutions | Amkor Technology vs. Cirrus Logic |
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Check out your portfolio center.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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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