Correlation Between Infinite Technology and Micron Technology

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

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

Diversification Opportunities for Infinite Technology and Micron Technology

0.0

Correlation Coefficient

Infinite Technology  Micron Technology

Pay attention - limited upside

The 3 months correlation between Infinite and Micron is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Infinite Technology Corp and Micron Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Micron Technology and Infinite 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 Infinite Technology Corp are associated (or correlated) with Micron Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Micron Technology has no effect on the direction of Infinite Technology i.e., Infinite Technology and Micron Technology go up and down completely randomly.

Pair Corralation between Infinite Technology and Micron Technology

If you would invest  8,698  in Micron Technology on December 19, 2024 and sell it today you would earn a total of  1,474  from holding Micron Technology or generate 16.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.31%
Values	Daily Returns

Infinite Technology Corp  vs.  Micron Technology

Infinite Technology Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Infinite Technology Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively steady fundamental indicators, Infinite Technology is not utilizing all of its potentials. The latest stock price chaos, may contribute to medium-term losses for the stakeholders.

Micron Technology

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Micron Technology are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Micron Technology unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Infinite Technology and Micron Technology

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

The idea behind Infinite Technology Corp and Micron 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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.