Correlation Between Nisshin Seifun and SIVERS SEMICONDUCTORS

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

By analyzing existing cross correlation between Nisshin Seifun Group and SIVERS SEMICONDUCTORS AB, you can compare the effects of market volatilities on Nisshin Seifun and SIVERS SEMICONDUCTORS 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 Nisshin Seifun with a short position of SIVERS SEMICONDUCTORS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nisshin Seifun and SIVERS SEMICONDUCTORS.

Diversification Opportunities for Nisshin Seifun and SIVERS SEMICONDUCTORS

-0.77

Correlation Coefficient

Nisshin Seifun  SIVERS SEMICONDUCTORS

Pay attention - limited upside

The 3 months correlation between Nisshin and SIVERS is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Nisshin Seifun Group and SIVERS SEMICONDUCTORS AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIVERS SEMICONDUCTORS and Nisshin Seifun 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 Nisshin Seifun Group are associated (or correlated) with SIVERS SEMICONDUCTORS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIVERS SEMICONDUCTORS has no effect on the direction of Nisshin Seifun i.e., Nisshin Seifun and SIVERS SEMICONDUCTORS go up and down completely randomly.

Pair Corralation between Nisshin Seifun and SIVERS SEMICONDUCTORS

If you would invest  43.00  in SIVERS SEMICONDUCTORS AB on October 20, 2024 and sell it today you would lose (10.00) from holding SIVERS SEMICONDUCTORS AB or give up 23.26% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	0.8%
Values	Daily Returns

Nisshin Seifun Group  vs.  SIVERS SEMICONDUCTORS AB

Nisshin Seifun Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nisshin Seifun Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Nisshin Seifun is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

SIVERS SEMICONDUCTORS

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in SIVERS SEMICONDUCTORS AB are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, SIVERS SEMICONDUCTORS reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Nisshin Seifun and SIVERS SEMICONDUCTORS

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

The idea behind Nisshin Seifun Group and SIVERS SEMICONDUCTORS AB 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 CEOs Directory module to screen CEOs from public companies around the world.