Correlation Between Carlyle and Amkor Technology

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

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

Diversification Opportunities for Carlyle and Amkor Technology

0.76

Correlation Coefficient

Carlyle  Amkor Technology

Poor diversification

The 3 months correlation between Carlyle and Amkor is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Carlyle Group and Amkor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amkor Technology and Carlyle 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 Carlyle Group are associated (or correlated) with Amkor Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amkor Technology has no effect on the direction of Carlyle i.e., Carlyle and Amkor Technology go up and down completely randomly.

Pair Corralation between Carlyle and Amkor Technology

Allowing for the 90-day total investment horizon Carlyle Group is expected to generate 0.98 times more return on investment than Amkor Technology. However, Carlyle Group is 1.02 times less risky than Amkor Technology. It trades about -0.08 of its potential returns per unit of risk. Amkor Technology is currently generating about -0.15 per unit of risk. If you would invest  4,988  in Carlyle Group on December 20, 2024 and sell it today you would lose (642.00) from holding Carlyle Group or give up 12.87% of portfolio value over 90 days.

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

Carlyle Group  vs.  Amkor Technology

Carlyle Group

Risk-Adjusted Performance

Very Weak

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

Amkor Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Amkor Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Even with inconsistent performance in the last few months, the Stock's forward-looking signals remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Carlyle and Amkor Technology

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

The idea behind Carlyle Group and Amkor Technology 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.