Correlation Between FRACTAL GAMING and ULTRA CLEAN
Can any of the company-specific risk be diversified away by investing in both FRACTAL GAMING and ULTRA CLEAN 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 FRACTAL GAMING and ULTRA CLEAN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FRACTAL GAMING GROUP and ULTRA CLEAN HLDGS, you can compare the effects of market volatilities on FRACTAL GAMING and ULTRA CLEAN 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 FRACTAL GAMING with a short position of ULTRA CLEAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of FRACTAL GAMING and ULTRA CLEAN.
Diversification Opportunities for FRACTAL GAMING and ULTRA CLEAN
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between FRACTAL and ULTRA is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding FRACTAL GAMING GROUP and ULTRA CLEAN HLDGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ULTRA CLEAN HLDGS and FRACTAL GAMING 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 FRACTAL GAMING GROUP are associated (or correlated) with ULTRA CLEAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ULTRA CLEAN HLDGS has no effect on the direction of FRACTAL GAMING i.e., FRACTAL GAMING and ULTRA CLEAN go up and down completely randomly.
Pair Corralation between FRACTAL GAMING and ULTRA CLEAN
Assuming the 90 days horizon FRACTAL GAMING GROUP is expected to under-perform the ULTRA CLEAN. But the stock apears to be less risky and, when comparing its historical volatility, FRACTAL GAMING GROUP is 2.06 times less risky than ULTRA CLEAN. The stock trades about -0.26 of its potential returns per unit of risk. The ULTRA CLEAN HLDGS is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 3,060 in ULTRA CLEAN HLDGS on September 1, 2024 and sell it today you would earn a total of 560.00 from holding ULTRA CLEAN HLDGS or generate 18.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FRACTAL GAMING GROUP vs. ULTRA CLEAN HLDGS
Performance |
| Timeline |
| FRACTAL GAMING GROUP |
| ULTRA CLEAN HLDGS |
FRACTAL GAMING and ULTRA CLEAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FRACTAL GAMING and ULTRA CLEAN
The main advantage of trading using opposite FRACTAL GAMING and ULTRA CLEAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FRACTAL GAMING position performs unexpectedly, ULTRA CLEAN 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 ULTRA CLEAN will offset losses from the drop in ULTRA CLEAN's long position.| FRACTAL GAMING vs. Avanos Medical | FRACTAL GAMING vs. ONWARD MEDICAL BV | FRACTAL GAMING vs. IMAGIN MEDICAL INC | FRACTAL GAMING vs. EAT WELL INVESTMENT |
| ULTRA CLEAN vs. DEVRY EDUCATION GRP | ULTRA CLEAN vs. WILLIS LEASE FIN | ULTRA CLEAN vs. G8 EDUCATION | ULTRA CLEAN vs. Grand Canyon Education |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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