Correlation Between Entegris and Pacific West
Can any of the company-specific risk be diversified away by investing in both Entegris and Pacific West 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 Entegris and Pacific West into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Entegris and Pacific West Bancorp, you can compare the effects of market volatilities on Entegris and Pacific West 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 Entegris with a short position of Pacific West. Check out your portfolio center. Please also check ongoing floating volatility patterns of Entegris and Pacific West.
Diversification Opportunities for Entegris and Pacific West
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Entegris and Pacific is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Entegris and Pacific West Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pacific West Bancorp and Entegris 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 Entegris are associated (or correlated) with Pacific West. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pacific West Bancorp has no effect on the direction of Entegris i.e., Entegris and Pacific West go up and down completely randomly.
Pair Corralation between Entegris and Pacific West
Given the investment horizon of 90 days Entegris is expected to under-perform the Pacific West. But the stock apears to be less risky and, when comparing its historical volatility, Entegris is 1.06 times less risky than Pacific West. The stock trades about -0.03 of its potential returns per unit of risk. The Pacific West Bancorp is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 1,145 in Pacific West Bancorp on November 6, 2024 and sell it today you would lose (35.00) from holding Pacific West Bancorp or give up 3.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Entegris vs. Pacific West Bancorp
Performance |
| Timeline |
| Entegris |
| Pacific West Bancorp |
Entegris and Pacific West Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Entegris and Pacific West
The main advantage of trading using opposite Entegris and Pacific West positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Entegris position performs unexpectedly, Pacific West 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 Pacific West will offset losses from the drop in Pacific West's long position.| Entegris vs. Teradyne | Entegris vs. Ichor Holdings | Entegris vs. Amtech Systems | Entegris vs. Veeco Instruments |
| Pacific West vs. Sphere Entertainment Co | Pacific West vs. Ballys Corp | Pacific West vs. Dine Brands Global | Pacific West vs. National CineMedia |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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