Correlation Between SIVERS SEMICONDUCTORS and Teradyne

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

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

Diversification Opportunities for SIVERS SEMICONDUCTORS and Teradyne

0.56

Correlation Coefficient

SIVERS SEMICONDUCTORS  Teradyne

Very weak diversification

The 3 months correlation between SIVERS and Teradyne is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding SIVERS SEMICONDUCTORS AB and Teradyne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teradyne and SIVERS SEMICONDUCTORS 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 SIVERS SEMICONDUCTORS AB are associated (or correlated) with Teradyne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teradyne has no effect on the direction of SIVERS SEMICONDUCTORS i.e., SIVERS SEMICONDUCTORS and Teradyne go up and down completely randomly.

Pair Corralation between SIVERS SEMICONDUCTORS and Teradyne

Assuming the 90 days horizon SIVERS SEMICONDUCTORS AB is expected to under-perform the Teradyne. In addition to that, SIVERS SEMICONDUCTORS is 3.32 times more volatile than Teradyne. It trades about -0.06 of its total potential returns per unit of risk. Teradyne is currently generating about 0.0 per unit of volatility. If you would invest  11,580  in Teradyne on September 15, 2024 and sell it today you would lose (158.00) from holding Teradyne or give up 1.36% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.48%
Values	Daily Returns

SIVERS SEMICONDUCTORS AB  vs.  Teradyne

SIVERS SEMICONDUCTORS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SIVERS SEMICONDUCTORS AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain 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.

Teradyne

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with SIVERS SEMICONDUCTORS and Teradyne

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

The idea behind SIVERS SEMICONDUCTORS AB and Teradyne 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 Stocks Directory module to find actively traded stocks across global markets.