Correlation Between Spectra7 Microsystems and Lasertec
Can any of the company-specific risk be diversified away by investing in both Spectra7 Microsystems and Lasertec 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 Spectra7 Microsystems and Lasertec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spectra7 Microsystems and Lasertec, you can compare the effects of market volatilities on Spectra7 Microsystems and Lasertec 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 Spectra7 Microsystems with a short position of Lasertec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spectra7 Microsystems and Lasertec.
Diversification Opportunities for Spectra7 Microsystems and Lasertec
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Spectra7 and Lasertec is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Spectra7 Microsystems and Lasertec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lasertec and Spectra7 Microsystems 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 Spectra7 Microsystems are associated (or correlated) with Lasertec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lasertec has no effect on the direction of Spectra7 Microsystems i.e., Spectra7 Microsystems and Lasertec go up and down completely randomly.
Pair Corralation between Spectra7 Microsystems and Lasertec
Assuming the 90 days horizon Spectra7 Microsystems is expected to generate 2.27 times more return on investment than Lasertec. However, Spectra7 Microsystems is 2.27 times more volatile than Lasertec. It trades about 0.0 of its potential returns per unit of risk. Lasertec is currently generating about 0.01 per unit of risk. If you would invest 74.00 in Spectra7 Microsystems on October 25, 2024 and sell it today you would lose (66.48) from holding Spectra7 Microsystems or give up 89.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Spectra7 Microsystems vs. Lasertec
Performance |
| Timeline |
| Spectra7 Microsystems |
| Lasertec |
Spectra7 Microsystems and Lasertec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spectra7 Microsystems and Lasertec
The main advantage of trading using opposite Spectra7 Microsystems and Lasertec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spectra7 Microsystems position performs unexpectedly, Lasertec 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 Lasertec will offset losses from the drop in Lasertec's long position.| Spectra7 Microsystems vs. Atomera | Spectra7 Microsystems vs. ASML Holding NV | Spectra7 Microsystems vs. Applied Materials | Spectra7 Microsystems vs. Aehr Test Systems |
| Lasertec vs. Sumco Corp ADR | Lasertec vs. Asm Pacific Technology | Lasertec vs. Disco Corp ADR | Lasertec vs. Tokyo Electron |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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