Correlation Between Intapp and Microchip Technology

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

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

Diversification Opportunities for Intapp and Microchip Technology

-0.56

Correlation Coefficient

Intapp  Microchip Technology

Excellent diversification

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

Pair Corralation between Intapp and Microchip Technology

Given the investment horizon of 90 days Intapp Inc is expected to under-perform the Microchip Technology. But the stock apears to be less risky and, when comparing its historical volatility, Intapp Inc is 1.36 times less risky than Microchip Technology. The stock trades about -0.19 of its potential returns per unit of risk. The Microchip Technology is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest  4,557  in Microchip Technology on April 29, 2025 and sell it today you would earn a total of  2,364  from holding Microchip Technology or generate 51.88% return on investment over 90 days.

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

Intapp Inc  vs.  Microchip Technology

Intapp Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Intapp Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Microchip Technology

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Microchip Technology are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating technical indicators, Microchip Technology reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Intapp and Microchip Technology

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

The idea behind Intapp Inc and Microchip Technology 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.