Correlation Between MOGU and MagnaChip Semiconductor

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

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

Diversification Opportunities for MOGU and MagnaChip Semiconductor

-0.07

Correlation Coefficient

MOGU  MagnaChip Semiconductor

Good diversification

The 3 months correlation between MOGU and MagnaChip is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding MOGU Inc and MagnaChip Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MagnaChip Semiconductor and MOGU 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 MOGU Inc are associated (or correlated) with MagnaChip Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MagnaChip Semiconductor has no effect on the direction of MOGU i.e., MOGU and MagnaChip Semiconductor go up and down completely randomly.

Pair Corralation between MOGU and MagnaChip Semiconductor

Given the investment horizon of 90 days MOGU Inc is expected to under-perform the MagnaChip Semiconductor. In addition to that, MOGU is 1.19 times more volatile than MagnaChip Semiconductor. It trades about -0.03 of its total potential returns per unit of risk. MagnaChip Semiconductor is currently generating about 0.06 per unit of volatility. If you would invest  377.00  in MagnaChip Semiconductor on December 19, 2024 and sell it today you would earn a total of  34.00  from holding MagnaChip Semiconductor or generate 9.02% return on investment over 90 days.

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

MOGU Inc  vs.  MagnaChip Semiconductor

MOGU Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days MOGU Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's technical and fundamental indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

MagnaChip Semiconductor

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in MagnaChip Semiconductor are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, MagnaChip Semiconductor may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with MOGU and MagnaChip Semiconductor

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

The idea behind MOGU Inc and MagnaChip Semiconductor 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.