Correlation Between GSI Technology and Intel

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

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

Diversification Opportunities for GSI Technology and Intel

0.04

Correlation Coefficient

GSI Technology  Intel

Significant diversification

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

Pair Corralation between GSI Technology and Intel

Given the investment horizon of 90 days GSI Technology is expected to under-perform the Intel. In addition to that, GSI Technology is 1.72 times more volatile than Intel. It trades about -0.03 of its total potential returns per unit of risk. Intel is currently generating about 0.08 per unit of volatility. If you would invest  2,030  in Intel on December 27, 2024 and sell it today you would earn a total of  312.00  from holding Intel or generate 15.37% return on investment over 90 days.

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

GSI Technology  vs.  Intel

GSI Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days GSI Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's forward indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Intel

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Intel are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Intel exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GSI Technology and Intel

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

The idea behind GSI Technology and Intel 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.