Correlation Between RBACN and Amkor Technology

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

By analyzing existing cross correlation between RBACN 775 15 MAR 31 and Amkor Technology, you can compare the effects of market volatilities on RBACN and Amkor 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 RBACN with a short position of Amkor Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of RBACN and Amkor Technology.

Diversification Opportunities for RBACN and Amkor Technology

-0.22

Correlation Coefficient

RBACN  Amkor Technology

Very good diversification

The 3 months correlation between RBACN and Amkor is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding RBACN 775 15 MAR 31 and Amkor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amkor Technology and RBACN 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 RBACN 775 15 MAR 31 are associated (or correlated) with Amkor Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amkor Technology has no effect on the direction of RBACN i.e., RBACN and Amkor Technology go up and down completely randomly.

Pair Corralation between RBACN and Amkor Technology

Assuming the 90 days trading horizon RBACN 775 15 MAR 31 is expected to generate 0.12 times more return on investment than Amkor Technology. However, RBACN 775 15 MAR 31 is 8.2 times less risky than Amkor Technology. It trades about -0.06 of its potential returns per unit of risk. Amkor Technology is currently generating about -0.07 per unit of risk. If you would invest  10,566  in RBACN 775 15 MAR 31 on October 25, 2024 and sell it today you would lose (103.00) from holding RBACN 775 15 MAR 31 or give up 0.97% of portfolio value over 90 days.

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

RBACN 775 15 MAR 31  vs.  Amkor Technology

RBACN 775 15

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days RBACN 775 15 MAR 31 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, RBACN is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Amkor Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amkor Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest inconsistent performance, the Stock's forward-looking signals remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with RBACN and Amkor Technology

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

The idea behind RBACN 775 15 MAR 31 and Amkor 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..