Correlation Between Intel and Alpha
Can any of the company-specific risk be diversified away by investing in both Intel and Alpha 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 Intel and Alpha into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel and Alpha and Omega, you can compare the effects of market volatilities on Intel and Alpha 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 Intel with a short position of Alpha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and Alpha.
Diversification Opportunities for Intel and Alpha
Very poor diversification
The 3 months correlation between Intel and Alpha is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Intel and Alpha and Omega in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alpha and Omega and Intel 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 Intel are associated (or correlated) with Alpha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alpha and Omega has no effect on the direction of Intel i.e., Intel and Alpha go up and down completely randomly.
Pair Corralation between Intel and Alpha
Given the investment horizon of 90 days Intel is expected to generate 3.36 times less return on investment than Alpha. But when comparing it to its historical volatility, Intel is 1.25 times less risky than Alpha. It trades about 0.07 of its potential returns per unit of risk. Alpha and Omega is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,904 in Alpha and Omega on April 26, 2025 and sell it today you would earn a total of 844.00 from holding Alpha and Omega or generate 44.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Intel vs. Alpha and Omega
Performance |
Timeline |
Intel |
Alpha and Omega |
Intel and Alpha Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Intel and Alpha
The main advantage of trading using opposite Intel and Alpha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel position performs unexpectedly, Alpha 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 Alpha will offset losses from the drop in Alpha's long position.Intel vs. Pioneer Bankcorp | Intel vs. Foreign Trade Bank | Intel vs. Colony Bankcorp | Intel vs. Middlefield Banc |
Alpha vs. MagnaChip Semiconductor | Alpha vs. Penguin Solutions, | Alpha vs. MaxLinear | Alpha vs. Diodes Incorporated |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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