Correlation Between Amtech Systems and Clorox
Can any of the company-specific risk be diversified away by investing in both Amtech Systems and Clorox 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 Clorox into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amtech Systems and The Clorox, you can compare the effects of market volatilities on Amtech Systems and Clorox 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 Clorox. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amtech Systems and Clorox.
Diversification Opportunities for Amtech Systems and Clorox
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Amtech and Clorox is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Amtech Systems and The Clorox in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clorox 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 Clorox. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clorox has no effect on the direction of Amtech Systems i.e., Amtech Systems and Clorox go up and down completely randomly.
Pair Corralation between Amtech Systems and Clorox
Given the investment horizon of 90 days Amtech Systems is expected to generate 1.77 times less return on investment than Clorox. In addition to that, Amtech Systems is 1.88 times more volatile than The Clorox. It trades about 0.08 of its total potential returns per unit of risk. The Clorox is currently generating about 0.28 per unit of volatility. If you would invest 15,772 in The Clorox on August 28, 2024 and sell it today you would earn a total of 860.00 from holding The Clorox or generate 5.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amtech Systems vs. The Clorox
Performance |
| Timeline |
| Amtech Systems |
| Clorox |
Amtech Systems and Clorox Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amtech Systems and Clorox
The main advantage of trading using opposite Amtech Systems and Clorox positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amtech Systems position performs unexpectedly, Clorox 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 Clorox will offset losses from the drop in Clorox's long position.| Amtech Systems vs. Ultra Clean Holdings | Amtech Systems vs. Veeco Instruments | Amtech Systems vs. Cohu Inc | Amtech Systems vs. Onto Innovation |
| Clorox vs. Colgate Palmolive | Clorox vs. Procter Gamble | Clorox vs. Unilever PLC ADR | Clorox vs. Church Dwight |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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