Correlation Between Ares Acquisition and Kulicke
Can any of the company-specific risk be diversified away by investing in both Ares Acquisition and Kulicke 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 Ares Acquisition and Kulicke into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ares Acquisition and Kulicke and Soffa, you can compare the effects of market volatilities on Ares Acquisition and Kulicke 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 Ares Acquisition with a short position of Kulicke. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ares Acquisition and Kulicke.
Diversification Opportunities for Ares Acquisition and Kulicke
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ares and Kulicke is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Ares Acquisition and Kulicke and Soffa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kulicke and Soffa and Ares Acquisition 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 Ares Acquisition are associated (or correlated) with Kulicke. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kulicke and Soffa has no effect on the direction of Ares Acquisition i.e., Ares Acquisition and Kulicke go up and down completely randomly.
Pair Corralation between Ares Acquisition and Kulicke
Assuming the 90 days trading horizon Ares Acquisition is expected to generate 3.11 times less return on investment than Kulicke. But when comparing it to its historical volatility, Ares Acquisition is 3.78 times less risky than Kulicke. It trades about 0.05 of its potential returns per unit of risk. Kulicke and Soffa is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 4,080 in Kulicke and Soffa on November 3, 2024 and sell it today you would earn a total of 355.00 from holding Kulicke and Soffa or generate 8.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.2% |
| Values | Daily Returns |
Ares Acquisition vs. Kulicke and Soffa
Performance |
| Timeline |
| Ares Acquisition |
| Kulicke and Soffa |
Ares Acquisition and Kulicke Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ares Acquisition and Kulicke
The main advantage of trading using opposite Ares Acquisition and Kulicke positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ares Acquisition position performs unexpectedly, Kulicke 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 Kulicke will offset losses from the drop in Kulicke's long position.| Ares Acquisition vs. Western Digital | Ares Acquisition vs. Arrow Electronics | Ares Acquisition vs. Uber Technologies | Ares Acquisition vs. High Performance Beverages |
| Kulicke vs. Ultra Clean Holdings | Kulicke vs. Ichor Holdings | Kulicke vs. Entegris | Kulicke vs. Amtech Systems |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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