Correlation Between BE Semiconductor and Entegris
Can any of the company-specific risk be diversified away by investing in both BE Semiconductor and Entegris 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 BE Semiconductor and Entegris into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BE Semiconductor Industries and Entegris, you can compare the effects of market volatilities on BE Semiconductor and Entegris 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 BE Semiconductor with a short position of Entegris. Check out your portfolio center. Please also check ongoing floating volatility patterns of BE Semiconductor and Entegris.
Diversification Opportunities for BE Semiconductor and Entegris
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BESIY and Entegris is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding BE Semiconductor Industries and Entegris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Entegris and BE Semiconductor 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 BE Semiconductor Industries are associated (or correlated) with Entegris. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Entegris has no effect on the direction of BE Semiconductor i.e., BE Semiconductor and Entegris go up and down completely randomly.
Pair Corralation between BE Semiconductor and Entegris
Assuming the 90 days horizon BE Semiconductor Industries is expected to generate 0.99 times more return on investment than Entegris. However, BE Semiconductor Industries is 1.01 times less risky than Entegris. It trades about 0.06 of its potential returns per unit of risk. Entegris is currently generating about 0.01 per unit of risk. If you would invest 11,379 in BE Semiconductor Industries on August 28, 2024 and sell it today you would earn a total of 340.00 from holding BE Semiconductor Industries or generate 2.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BE Semiconductor Industries vs. Entegris
Performance |
| Timeline |
| BE Semiconductor Ind |
| Entegris |
BE Semiconductor and Entegris Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BE Semiconductor and Entegris
The main advantage of trading using opposite BE Semiconductor and Entegris positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BE Semiconductor position performs unexpectedly, Entegris 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 Entegris will offset losses from the drop in Entegris' long position.| BE Semiconductor vs. Lasertec | BE Semiconductor vs. Tokyo Electron Ltd | BE Semiconductor vs. Asm Pacific Technology | BE Semiconductor vs. Sumco Corp ADR |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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