Correlation Between BE Semiconductor and Amdocs

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

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

Diversification Opportunities for BE Semiconductor and Amdocs

-0.29

Correlation Coefficient

BE Semiconductor  Amdocs

Very good diversification

The 3 months correlation between BSI and Amdocs is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding BE Semiconductor Industries and Amdocs Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amdocs Limited and BE Semiconductor 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 BE Semiconductor Industries are associated (or correlated) with Amdocs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amdocs Limited has no effect on the direction of BE Semiconductor i.e., BE Semiconductor and Amdocs go up and down completely randomly.

Pair Corralation between BE Semiconductor and Amdocs

Assuming the 90 days trading horizon BE Semiconductor Industries is expected to generate 1.92 times more return on investment than Amdocs. However, BE Semiconductor is 1.92 times more volatile than Amdocs Limited. It trades about 0.06 of its potential returns per unit of risk. Amdocs Limited is currently generating about -0.07 per unit of risk. If you would invest  10,655  in BE Semiconductor Industries on May 25, 2025 and sell it today you would earn a total of  840.00  from holding BE Semiconductor Industries or generate 7.88% return on investment over 90 days.

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

BE Semiconductor Industries  vs.  Amdocs Limited

BE Semiconductor Ind

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in BE Semiconductor Industries are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, BE Semiconductor may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Amdocs Limited

Risk-Adjusted Performance

Weakest

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

Pair Trading with BE Semiconductor and Amdocs

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

The idea behind BE Semiconductor Industries and Amdocs Limited 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 Transaction History module to view history of all your transactions and understand their impact on performance.