Correlation Between Corning and STMicroelectronics

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

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

Diversification Opportunities for Corning and STMicroelectronics

0.0

Correlation Coefficient

Corning  STMicroelectronics

Pay attention - limited upside

The 3 months correlation between Corning and STMicroelectronics is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Corning and STMicroelectronics NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STMicroelectronics and Corning 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 Corning are associated (or correlated) with STMicroelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STMicroelectronics has no effect on the direction of Corning i.e., Corning and STMicroelectronics go up and down completely randomly.

Pair Corralation between Corning and STMicroelectronics

If you would invest  1,975  in STMicroelectronics NV on April 24, 2025 and sell it today you would earn a total of  839.00  from holding STMicroelectronics NV or generate 42.48% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.61%
Values	Daily Returns

Corning  vs.  STMicroelectronics NV

Corning

Risk-Adjusted Performance

Solid

Over the last 90 days Corning has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Corning is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

STMicroelectronics

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in STMicroelectronics NV are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, STMicroelectronics unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Corning and STMicroelectronics

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

The idea behind Corning and STMicroelectronics NV 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.