Correlation Between Axcelis Technologies and Navitas Semiconductor
Can any of the company-specific risk be diversified away by investing in both Axcelis Technologies and Navitas Semiconductor 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 Axcelis Technologies and Navitas Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axcelis Technologies and Navitas Semiconductor Corp, you can compare the effects of market volatilities on Axcelis Technologies and Navitas Semiconductor 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 Axcelis Technologies with a short position of Navitas Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axcelis Technologies and Navitas Semiconductor.
Diversification Opportunities for Axcelis Technologies and Navitas Semiconductor
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Axcelis and Navitas is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Axcelis Technologies and Navitas Semiconductor Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Navitas Semiconductor and Axcelis Technologies 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 Axcelis Technologies are associated (or correlated) with Navitas Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Navitas Semiconductor has no effect on the direction of Axcelis Technologies i.e., Axcelis Technologies and Navitas Semiconductor go up and down completely randomly.
Pair Corralation between Axcelis Technologies and Navitas Semiconductor
Given the investment horizon of 90 days Axcelis Technologies is expected to under-perform the Navitas Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Axcelis Technologies is 1.35 times less risky than Navitas Semiconductor. The stock trades about -0.13 of its potential returns per unit of risk. The Navitas Semiconductor Corp is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 345.00 in Navitas Semiconductor Corp on November 25, 2024 and sell it today you would lose (28.00) from holding Navitas Semiconductor Corp or give up 8.12% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Axcelis Technologies vs. Navitas Semiconductor Corp
Performance |
Timeline |
Axcelis Technologies |
Navitas Semiconductor |
Axcelis Technologies and Navitas Semiconductor Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Axcelis Technologies and Navitas Semiconductor
The main advantage of trading using opposite Axcelis Technologies and Navitas Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axcelis Technologies position performs unexpectedly, Navitas Semiconductor 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 Navitas Semiconductor will offset losses from the drop in Navitas Semiconductor's long position.Axcelis Technologies vs. inTest | ||
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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 Global Correlations module to find global opportunities by holding instruments from different markets.
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