Correlation Between Indie Semiconductor and Arteris

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

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

Diversification Opportunities for Indie Semiconductor and Arteris

0.93

Correlation Coefficient

Indie Semiconductor  Arteris

Almost no diversification

The 3 months correlation between Indie and Arteris is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding indie Semiconductor and Arteris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arteris and Indie 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 indie Semiconductor are associated (or correlated) with Arteris. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arteris has no effect on the direction of Indie Semiconductor i.e., Indie Semiconductor and Arteris go up and down completely randomly.

Pair Corralation between Indie Semiconductor and Arteris

Given the investment horizon of 90 days indie Semiconductor is expected to generate 1.34 times more return on investment than Arteris. However, Indie Semiconductor is 1.34 times more volatile than Arteris. It trades about 0.21 of its potential returns per unit of risk. Arteris is currently generating about 0.13 per unit of risk. If you would invest  201.00  in indie Semiconductor on May 5, 2025 and sell it today you would earn a total of  173.00  from holding indie Semiconductor or generate 86.07% return on investment over 90 days.

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

indie Semiconductor  vs.  Arteris

indie Semiconductor

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in indie Semiconductor are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite fairly conflicting fundamental indicators, Indie Semiconductor demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Arteris

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Arteris are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating forward indicators, Arteris reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Indie Semiconductor and Arteris

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

The idea behind indie Semiconductor and Arteris 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.