Correlation Between Micron Technology and GMK Norilskiy

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

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

Diversification Opportunities for Micron Technology and GMK Norilskiy

0.0

Correlation Coefficient

Micron Technology  GMK Norilskiy

Pay attention - limited upside

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

Pair Corralation between Micron Technology and GMK Norilskiy

If you would invest  9,411  in Micron Technology on December 5, 2024 and sell it today you would lose (291.00) from holding Micron Technology or give up 3.09% of portfolio value over 90 days.

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

Micron Technology  vs.  GMK Norilskiy Nikel

Micron Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Micron Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Micron Technology is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

GMK Norilskiy Nikel

Risk-Adjusted Performance

Very Weak

Over the last 90 days GMK Norilskiy Nikel has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, GMK Norilskiy is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Micron Technology and GMK Norilskiy

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

The idea behind Micron Technology and GMK Norilskiy Nikel 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.