Correlation Between STMicroelectronics and Klegg Electronics

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

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

Diversification Opportunities for STMicroelectronics and Klegg Electronics

0.0

Correlation Coefficient

STMicroelectronics  Klegg Electronics

Pay attention - limited upside

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

Pair Corralation between STMicroelectronics and Klegg Electronics

If you would invest  0.01  in Klegg Electronics on October 8, 2025 and sell it today you would earn a total of  0.00  from holding Klegg Electronics or generate 0.0% return on investment over 90 days.

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

STMicroelectronics NV  vs.  Klegg Electronics

STMicroelectronics

Risk-Adjusted Performance

Weakest

Over the last 90 days STMicroelectronics NV has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, STMicroelectronics is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Klegg Electronics

Risk-Adjusted Performance

Weakest

Over the last 90 days Klegg Electronics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Klegg Electronics is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with STMicroelectronics and Klegg Electronics

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

The idea behind STMicroelectronics NV and Klegg Electronics 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.