Correlation Between IPG Photonics and Eastgate Biotech
Can any of the company-specific risk be diversified away by investing in both IPG Photonics and Eastgate Biotech 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 IPG Photonics and Eastgate Biotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IPG Photonics and Eastgate Biotech Corp, you can compare the effects of market volatilities on IPG Photonics and Eastgate Biotech 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 IPG Photonics with a short position of Eastgate Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of IPG Photonics and Eastgate Biotech.
Diversification Opportunities for IPG Photonics and Eastgate Biotech
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between IPG and Eastgate is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding IPG Photonics and Eastgate Biotech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastgate Biotech Corp and IPG Photonics 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 IPG Photonics are associated (or correlated) with Eastgate Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastgate Biotech Corp has no effect on the direction of IPG Photonics i.e., IPG Photonics and Eastgate Biotech go up and down completely randomly.
Pair Corralation between IPG Photonics and Eastgate Biotech
If you would invest 7,639 in IPG Photonics on September 14, 2024 and sell it today you would earn a total of 173.00 from holding IPG Photonics or generate 2.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
IPG Photonics vs. Eastgate Biotech Corp
Performance |
| Timeline |
| IPG Photonics |
| Eastgate Biotech Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
IPG Photonics and Eastgate Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IPG Photonics and Eastgate Biotech
The main advantage of trading using opposite IPG Photonics and Eastgate Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IPG Photonics position performs unexpectedly, Eastgate Biotech 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 Eastgate Biotech will offset losses from the drop in Eastgate Biotech's long position.| IPG Photonics vs. Teradyne | IPG Photonics vs. Ultra Clean Holdings | IPG Photonics vs. Onto Innovation | IPG Photonics vs. Cohu Inc |
| Eastgate Biotech vs. Amkor Technology | Eastgate Biotech vs. Black Hills | Eastgate Biotech vs. IPG Photonics | Eastgate Biotech vs. NetEase |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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