Correlation Between Entegris and Veeco Instruments
Can any of the company-specific risk be diversified away by investing in both Entegris and Veeco Instruments 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 Veeco Instruments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Entegris and Veeco Instruments, you can compare the effects of market volatilities on Entegris and Veeco Instruments 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 Veeco Instruments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Entegris and Veeco Instruments.
Diversification Opportunities for Entegris and Veeco Instruments
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Entegris and Veeco is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Entegris and Veeco Instruments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Veeco Instruments 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 Veeco Instruments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Veeco Instruments has no effect on the direction of Entegris i.e., Entegris and Veeco Instruments go up and down completely randomly.
Pair Corralation between Entegris and Veeco Instruments
Given the investment horizon of 90 days Entegris is expected to generate 1.28 times more return on investment than Veeco Instruments. However, Entegris is 1.28 times more volatile than Veeco Instruments. It trades about 0.05 of its potential returns per unit of risk. Veeco Instruments is currently generating about -0.09 per unit of risk. If you would invest 10,585 in Entegris on August 28, 2024 and sell it today you would earn a total of 217.00 from holding Entegris or generate 2.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Entegris vs. Veeco Instruments
Performance |
| Timeline |
| Entegris |
| Veeco Instruments |
Entegris and Veeco Instruments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Entegris and Veeco Instruments
The main advantage of trading using opposite Entegris and Veeco Instruments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Entegris position performs unexpectedly, Veeco Instruments 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 Veeco Instruments will offset losses from the drop in Veeco Instruments' long position.| Entegris vs. Teradyne | Entegris vs. Ichor Holdings | Entegris vs. Amtech Systems | Entegris vs. Veeco Instruments |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |