Correlation Between Microchip Technology and Vienna Insurance

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

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

Diversification Opportunities for Microchip Technology and Vienna Insurance

0.0

Correlation Coefficient

Microchip Technology  Vienna Insurance

Pay attention - limited upside

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

Pair Corralation between Microchip Technology and Vienna Insurance

If you would invest  6,263  in Microchip Technology Incorporated on September 20, 2024 and sell it today you would lose (658.00) from holding Microchip Technology Incorporated or give up 10.51% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Microchip Technology Incorpora  vs.  Vienna Insurance Group

Microchip Technology

Risk-Adjusted Performance

0 of 100

Very Weak

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

Vienna Insurance

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Microchip Technology and Vienna Insurance

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

The idea behind Microchip Technology Incorporated and Vienna Insurance Group 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.