Correlation Between Camtek and EchoStar
Can any of the company-specific risk be diversified away by investing in both Camtek and EchoStar 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 Camtek and EchoStar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Camtek and EchoStar, you can compare the effects of market volatilities on Camtek and EchoStar 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 Camtek with a short position of EchoStar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Camtek and EchoStar.
Diversification Opportunities for Camtek and EchoStar
Excellent diversification
The 3 months correlation between Camtek and EchoStar is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Camtek and EchoStar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EchoStar and Camtek 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 Camtek are associated (or correlated) with EchoStar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EchoStar has no effect on the direction of Camtek i.e., Camtek and EchoStar go up and down completely randomly.
Pair Corralation between Camtek and EchoStar
Given the investment horizon of 90 days Camtek is expected to generate 0.8 times more return on investment than EchoStar. However, Camtek is 1.25 times less risky than EchoStar. It trades about 0.09 of its potential returns per unit of risk. EchoStar is currently generating about 0.04 per unit of risk. If you would invest 2,226 in Camtek on August 28, 2024 and sell it today you would earn a total of 4,941 from holding Camtek or generate 221.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Camtek vs. EchoStar
Performance |
| Timeline |
| Camtek |
| EchoStar |
Camtek and EchoStar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Camtek and EchoStar
The main advantage of trading using opposite Camtek and EchoStar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Camtek position performs unexpectedly, EchoStar 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 EchoStar will offset losses from the drop in EchoStar's long position.| Camtek vs. Onto Innovation | Camtek vs. Amtech Systems | Camtek vs. Veeco Instruments | Camtek vs. Ichor Holdings |
| EchoStar vs. ADTRAN Inc | EchoStar vs. Mynaric AG ADR | EchoStar vs. KVH Industries | EchoStar vs. Telesat Corp |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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