Correlation Between Advanced Micro and Overseas Series

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

By analyzing existing cross correlation between Advanced Micro Devices and Overseas Series Class, you can compare the effects of market volatilities on Advanced Micro and Overseas Series 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 Advanced Micro with a short position of Overseas Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Micro and Overseas Series.

Diversification Opportunities for Advanced Micro and Overseas Series

-0.21

Correlation Coefficient

Advanced Micro  Overseas Series

Very good diversification

The 3 months correlation between Advanced and Overseas is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Micro Devices and Overseas Series Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Overseas Series Class and Advanced Micro 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 Advanced Micro Devices are associated (or correlated) with Overseas Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Overseas Series Class has no effect on the direction of Advanced Micro i.e., Advanced Micro and Overseas Series go up and down completely randomly.

Pair Corralation between Advanced Micro and Overseas Series

Assuming the 90 days trading horizon Advanced Micro Devices is expected to generate 6.3 times more return on investment than Overseas Series. However, Advanced Micro is 6.3 times more volatile than Overseas Series Class. It trades about 0.14 of its potential returns per unit of risk. Overseas Series Class is currently generating about -0.02 per unit of risk. If you would invest  3,068  in Advanced Micro Devices on August 20, 2025 and sell it today you would earn a total of  1,189  from holding Advanced Micro Devices or generate 38.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Advanced Micro Devices  vs.  Overseas Series Class

Advanced Micro Devices

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Advanced Micro Devices are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain fundamental indicators, Advanced Micro displayed solid returns over the last few months and may actually be approaching a breakup point.

Overseas Series Class

Risk-Adjusted Performance

Weakest

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

Pair Trading with Advanced Micro and Overseas Series

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

The idea behind Advanced Micro Devices and Overseas Series Class 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.