Correlation Between Aehr Test and Everspin Technologies
Can any of the company-specific risk be diversified away by investing in both Aehr Test and Everspin Technologies 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 Aehr Test and Everspin Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aehr Test Systems and Everspin Technologies, you can compare the effects of market volatilities on Aehr Test and Everspin Technologies 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 Aehr Test with a short position of Everspin Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aehr Test and Everspin Technologies.
Diversification Opportunities for Aehr Test and Everspin Technologies
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Aehr and Everspin is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Aehr Test Systems and Everspin Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everspin Technologies and Aehr Test 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 Aehr Test Systems are associated (or correlated) with Everspin Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everspin Technologies has no effect on the direction of Aehr Test i.e., Aehr Test and Everspin Technologies go up and down completely randomly.
Pair Corralation between Aehr Test and Everspin Technologies
Given the investment horizon of 90 days Aehr Test is expected to generate 20.0 times less return on investment than Everspin Technologies. In addition to that, Aehr Test is 1.98 times more volatile than Everspin Technologies. It trades about 0.0 of its total potential returns per unit of risk. Everspin Technologies is currently generating about 0.02 per unit of volatility. If you would invest 566.00 in Everspin Technologies on September 2, 2024 and sell it today you would earn a total of 48.00 from holding Everspin Technologies or generate 8.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aehr Test Systems vs. Everspin Technologies
Performance |
| Timeline |
| Aehr Test Systems |
| Everspin Technologies |
Aehr Test and Everspin Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aehr Test and Everspin Technologies
The main advantage of trading using opposite Aehr Test and Everspin Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aehr Test position performs unexpectedly, Everspin Technologies 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 Everspin Technologies will offset losses from the drop in Everspin Technologies' long position.| Aehr Test vs. Photronics | Aehr Test vs. Lam Research Corp | Aehr Test vs. KLA Tencor | Aehr Test vs. Kulicke and Soffa |
| Everspin Technologies vs. NXP Semiconductors NV | Everspin Technologies vs. GSI Technology | Everspin Technologies vs. MaxLinear | Everspin Technologies vs. Texas Instruments Incorporated |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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