Correlation Between Amtech Systems and Alpha
Can any of the company-specific risk be diversified away by investing in both Amtech Systems and Alpha 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 Amtech Systems and Alpha into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amtech Systems and Alpha and Omega, you can compare the effects of market volatilities on Amtech Systems and Alpha 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 Amtech Systems with a short position of Alpha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amtech Systems and Alpha.
Diversification Opportunities for Amtech Systems and Alpha
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Amtech and Alpha is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Amtech Systems and Alpha and Omega in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alpha and Omega and Amtech Systems 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 Amtech Systems are associated (or correlated) with Alpha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alpha and Omega has no effect on the direction of Amtech Systems i.e., Amtech Systems and Alpha go up and down completely randomly.
Pair Corralation between Amtech Systems and Alpha
Given the investment horizon of 90 days Amtech Systems is expected to generate 6.43 times less return on investment than Alpha. But when comparing it to its historical volatility, Amtech Systems is 5.55 times less risky than Alpha. It trades about 0.08 of its potential returns per unit of risk. Alpha and Omega is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 3,622 in Alpha and Omega on August 28, 2024 and sell it today you would earn a total of 414.00 from holding Alpha and Omega or generate 11.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amtech Systems vs. Alpha and Omega
Performance |
| Timeline |
| Amtech Systems |
| Alpha and Omega |
Amtech Systems and Alpha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amtech Systems and Alpha
The main advantage of trading using opposite Amtech Systems and Alpha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amtech Systems position performs unexpectedly, Alpha 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 Alpha will offset losses from the drop in Alpha's long position.| Amtech Systems vs. Ultra Clean Holdings | Amtech Systems vs. Veeco Instruments | Amtech Systems vs. Cohu Inc | Amtech Systems vs. Onto Innovation |
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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