Correlation Between MaxLinear and Intel

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

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

Diversification Opportunities for MaxLinear and Intel

-0.13

Correlation Coefficient

MaxLinear  Intel

Good diversification

The 3 months correlation between MaxLinear and Intel is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding MaxLinear and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel and MaxLinear 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 MaxLinear 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 MaxLinear i.e., MaxLinear and Intel go up and down completely randomly.

Pair Corralation between MaxLinear and Intel

Considering the 90-day investment horizon MaxLinear is expected to under-perform the Intel. In addition to that, MaxLinear is 1.46 times more volatile than Intel. It trades about -0.02 of its total potential returns per unit of risk. Intel is currently generating about 0.0 per unit of volatility. If you would invest  4,216  in Intel on January 26, 2024 and sell it today you would lose (766.00) from holding Intel or give up 18.17% of portfolio value over 90 days.

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

MaxLinear  vs.  Intel

MaxLinear

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MaxLinear has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, MaxLinear is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Intel

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intel has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in May 2024. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with MaxLinear and Intel

The main advantage of trading using opposite MaxLinear and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MaxLinear 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 MaxLinear 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 CEOs Directory module to screen CEOs from public companies around the world.