Correlation Between ThinTech Materials and Weltrend Semiconductor

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

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

Diversification Opportunities for ThinTech Materials and Weltrend Semiconductor

0.64

Correlation Coefficient

ThinTech Materials  Weltrend Semiconductor

Poor diversification

The 3 months correlation between ThinTech and Weltrend is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding ThinTech Materials Technology and Weltrend Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weltrend Semiconductor and ThinTech Materials 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 ThinTech Materials Technology are associated (or correlated) with Weltrend Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weltrend Semiconductor has no effect on the direction of ThinTech Materials i.e., ThinTech Materials and Weltrend Semiconductor go up and down completely randomly.

Pair Corralation between ThinTech Materials and Weltrend Semiconductor

Assuming the 90 days trading horizon ThinTech Materials Technology is expected to generate 1.4 times more return on investment than Weltrend Semiconductor. However, ThinTech Materials is 1.4 times more volatile than Weltrend Semiconductor. It trades about 0.12 of its potential returns per unit of risk. Weltrend Semiconductor is currently generating about 0.07 per unit of risk. If you would invest  5,030  in ThinTech Materials Technology on May 7, 2025 and sell it today you would earn a total of  1,160  from holding ThinTech Materials Technology or generate 23.06% return on investment over 90 days.

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

ThinTech Materials Technology  vs.  Weltrend Semiconductor

ThinTech Materials

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ThinTech Materials Technology are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, ThinTech Materials showed solid returns over the last few months and may actually be approaching a breakup point.

Weltrend Semiconductor

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Weltrend Semiconductor are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Weltrend Semiconductor may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with ThinTech Materials and Weltrend Semiconductor

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

The idea behind ThinTech Materials Technology and Weltrend 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.

Check out your portfolio center.

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.