Correlation Between Patterson UTI and Acm Research
Can any of the company-specific risk be diversified away by investing in both Patterson UTI and Acm Research 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 Patterson UTI and Acm Research into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Patterson UTI Energy and Acm Research, you can compare the effects of market volatilities on Patterson UTI and Acm Research 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 Patterson UTI with a short position of Acm Research. Check out your portfolio center. Please also check ongoing floating volatility patterns of Patterson UTI and Acm Research.
Diversification Opportunities for Patterson UTI and Acm Research
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Patterson and Acm is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Patterson UTI Energy and Acm Research in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acm Research and Patterson UTI 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 Patterson UTI Energy are associated (or correlated) with Acm Research. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acm Research has no effect on the direction of Patterson UTI i.e., Patterson UTI and Acm Research go up and down completely randomly.
Pair Corralation between Patterson UTI and Acm Research
Given the investment horizon of 90 days Patterson UTI Energy is expected to under-perform the Acm Research. But the stock apears to be less risky and, when comparing its historical volatility, Patterson UTI Energy is 1.49 times less risky than Acm Research. The stock trades about -0.03 of its potential returns per unit of risk. The Acm Research is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,786 in Acm Research on August 28, 2024 and sell it today you would earn a total of 58.00 from holding Acm Research or generate 3.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Patterson UTI Energy vs. Acm Research
Performance |
| Timeline |
| Patterson UTI Energy |
| Acm Research |
Patterson UTI and Acm Research Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Patterson UTI and Acm Research
The main advantage of trading using opposite Patterson UTI and Acm Research positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Patterson UTI position performs unexpectedly, Acm Research 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 Acm Research will offset losses from the drop in Acm Research's long position.| Patterson UTI vs. Nabors Industries | Patterson UTI vs. Precision Drilling | Patterson UTI vs. Noble plc | Patterson UTI vs. Helmerich and Payne |
| Acm Research vs. Axcelis Technologies | Acm Research vs. inTest | Acm Research vs. Lam Research Corp | Acm Research vs. Photronics |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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