Correlation Between KLA Tencor and Everspin Technologies
Can any of the company-specific risk be diversified away by investing in both KLA Tencor and Everspin Technologies 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 KLA Tencor and Everspin Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KLA Tencor and Everspin Technologies, you can compare the effects of market volatilities on KLA Tencor and Everspin Technologies 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 KLA Tencor with a short position of Everspin Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of KLA Tencor and Everspin Technologies.
Diversification Opportunities for KLA Tencor and Everspin Technologies
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KLA and Everspin is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding KLA Tencor and Everspin Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everspin Technologies and KLA Tencor 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 KLA Tencor are associated (or correlated) with Everspin Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everspin Technologies has no effect on the direction of KLA Tencor i.e., KLA Tencor and Everspin Technologies go up and down completely randomly.
Pair Corralation between KLA Tencor and Everspin Technologies
Given the investment horizon of 90 days KLA Tencor is expected to under-perform the Everspin Technologies. But the stock apears to be less risky and, when comparing its historical volatility, KLA Tencor is 1.64 times less risky than Everspin Technologies. The stock trades about -0.22 of its potential returns per unit of risk. The Everspin Technologies is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest 669.00 in Everspin Technologies on August 30, 2024 and sell it today you would lose (59.00) from holding Everspin Technologies or give up 8.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
KLA Tencor vs. Everspin Technologies
Performance |
| Timeline |
| KLA Tencor |
| Everspin Technologies |
KLA Tencor and Everspin Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KLA Tencor and Everspin Technologies
The main advantage of trading using opposite KLA Tencor and Everspin Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KLA Tencor position performs unexpectedly, Everspin Technologies 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 Everspin Technologies will offset losses from the drop in Everspin Technologies' long position.| KLA Tencor vs. Applied Materials | KLA Tencor vs. ASML Holding NV | KLA Tencor vs. Axcelis Technologies | KLA Tencor vs. Teradyne |
| Everspin Technologies vs. ABIVAX Socit Anonyme | Everspin Technologies vs. Morningstar Unconstrained Allocation | Everspin Technologies vs. SPACE | Everspin Technologies vs. Knife River |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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