Correlation Between Silicon Laboratories and Intel

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

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

Diversification Opportunities for Silicon Laboratories and Intel

0.62

Correlation Coefficient

Silicon Laboratories  Intel

Poor diversification

The 3 months correlation between Silicon and Intel is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Silicon Laboratories and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel and Silicon Laboratories 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 Silicon Laboratories are associated (or correlated) with Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of Silicon Laboratories i.e., Silicon Laboratories and Intel go up and down completely randomly.

Pair Corralation between Silicon Laboratories and Intel

Given the investment horizon of 90 days Silicon Laboratories is expected to generate 1.0 times more return on investment than Intel. However, Silicon Laboratories is 1.0 times more volatile than Intel. It trades about 0.07 of its potential returns per unit of risk. Intel is currently generating about -0.01 per unit of risk. If you would invest  11,107  in Silicon Laboratories on May 8, 2025 and sell it today you would earn a total of  1,180  from holding Silicon Laboratories or generate 10.62% return on investment over 90 days.

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

Silicon Laboratories  vs.  Intel

Silicon Laboratories

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Silicon Laboratories are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Silicon Laboratories sustained solid returns over the last few months and may actually be approaching a breakup point.

Intel

Risk-Adjusted Performance

Weakest

Over the last 90 days Intel has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Intel is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Silicon Laboratories and Intel

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

The idea behind Silicon Laboratories and Intel 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.