Correlation Between Cirrus Logic and NVIDIA
Can any of the company-specific risk be diversified away by investing in both Cirrus Logic and NVIDIA 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 Cirrus Logic and NVIDIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cirrus Logic and NVIDIA, you can compare the effects of market volatilities on Cirrus Logic and NVIDIA 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 Cirrus Logic with a short position of NVIDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cirrus Logic and NVIDIA.
Diversification Opportunities for Cirrus Logic and NVIDIA
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cirrus and NVIDIA is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Cirrus Logic and NVIDIA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NVIDIA and Cirrus Logic 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 Cirrus Logic are associated (or correlated) with NVIDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NVIDIA has no effect on the direction of Cirrus Logic i.e., Cirrus Logic and NVIDIA go up and down completely randomly.
Pair Corralation between Cirrus Logic and NVIDIA
Given the investment horizon of 90 days Cirrus Logic is expected to generate 1.44 times less return on investment than NVIDIA. In addition to that, Cirrus Logic is 1.3 times more volatile than NVIDIA. It trades about 0.15 of its total potential returns per unit of risk. NVIDIA is currently generating about 0.29 per unit of volatility. If you would invest 13,737 in NVIDIA on May 31, 2025 and sell it today you would earn a total of 4,280 from holding NVIDIA or generate 31.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cirrus Logic vs. NVIDIA
Performance |
| Timeline |
| Cirrus Logic |
| NVIDIA |
Cirrus Logic and NVIDIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cirrus Logic and NVIDIA
The main advantage of trading using opposite Cirrus Logic and NVIDIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cirrus Logic position performs unexpectedly, NVIDIA 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 NVIDIA will offset losses from the drop in NVIDIA's long position.| Cirrus Logic vs. SolarEdge Technologies | Cirrus Logic vs. First Solar | Cirrus Logic vs. Sunrun Inc | Cirrus Logic vs. Canadian Solar |
| NVIDIA vs. SolarEdge Technologies | NVIDIA vs. First Solar | NVIDIA vs. Sunrun Inc | NVIDIA vs. Canadian Solar |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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