Correlation Between CEVA and Intchains Group

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

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

Diversification Opportunities for CEVA and Intchains Group

-0.04

Correlation Coefficient

CEVA  Intchains Group

Good diversification

The 3 months correlation between CEVA and Intchains is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding CEVA Inc and Intchains Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intchains Group and CEVA 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 CEVA Inc are associated (or correlated) with Intchains Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intchains Group has no effect on the direction of CEVA i.e., CEVA and Intchains Group go up and down completely randomly.

Pair Corralation between CEVA and Intchains Group

Given the investment horizon of 90 days CEVA Inc is expected to generate 0.33 times more return on investment than Intchains Group. However, CEVA Inc is 3.05 times less risky than Intchains Group. It trades about 0.01 of its potential returns per unit of risk. Intchains Group Limited is currently generating about -0.04 per unit of risk. If you would invest  3,111  in CEVA Inc on December 20, 2024 and sell it today you would lose (109.00) from holding CEVA Inc or give up 3.5% of portfolio value over 90 days.

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

CEVA Inc  vs.  Intchains Group Limited

CEVA Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days CEVA Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, CEVA is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Intchains Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Intchains Group Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with CEVA and Intchains Group

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

The idea behind CEVA Inc and Intchains Group Limited 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.