Correlation Between Ecovyst and Amkor Technology
Can any of the company-specific risk be diversified away by investing in both Ecovyst and Amkor Technology 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 Ecovyst and Amkor Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecovyst and Amkor Technology, you can compare the effects of market volatilities on Ecovyst and Amkor Technology 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 Ecovyst with a short position of Amkor Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecovyst and Amkor Technology.
Diversification Opportunities for Ecovyst and Amkor Technology
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ecovyst and Amkor is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Ecovyst and Amkor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amkor Technology and Ecovyst 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 Ecovyst are associated (or correlated) with Amkor Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amkor Technology has no effect on the direction of Ecovyst i.e., Ecovyst and Amkor Technology go up and down completely randomly.
Pair Corralation between Ecovyst and Amkor Technology
Given the investment horizon of 90 days Ecovyst is expected to under-perform the Amkor Technology. But the stock apears to be less risky and, when comparing its historical volatility, Ecovyst is 1.12 times less risky than Amkor Technology. The stock trades about -0.03 of its potential returns per unit of risk. The Amkor Technology is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 2,725 in Amkor Technology on September 12, 2024 and sell it today you would lose (46.00) from holding Amkor Technology or give up 1.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ecovyst vs. Amkor Technology
Performance |
| Timeline |
| Ecovyst |
| Amkor Technology |
Ecovyst and Amkor Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecovyst and Amkor Technology
The main advantage of trading using opposite Ecovyst and Amkor Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecovyst position performs unexpectedly, Amkor Technology 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 Amkor Technology will offset losses from the drop in Amkor Technology's long position.| Ecovyst vs. Orion Engineered Carbons | Ecovyst vs. Cabot | Ecovyst vs. Minerals Technologies | Ecovyst vs. Quaker Chemical |
| Amkor Technology vs. Power Integrations | Amkor Technology vs. Diodes Incorporated | Amkor Technology vs. MACOM Technology Solutions | Amkor Technology vs. Cirrus Logic |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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