Correlation Between Sumco Corp and Amtech Systems
Can any of the company-specific risk be diversified away by investing in both Sumco Corp and Amtech Systems 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 Sumco Corp and Amtech Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sumco Corp ADR and Amtech Systems, you can compare the effects of market volatilities on Sumco Corp and Amtech Systems 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 Sumco Corp with a short position of Amtech Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sumco Corp and Amtech Systems.
Diversification Opportunities for Sumco Corp and Amtech Systems
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sumco and Amtech is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Sumco Corp ADR and Amtech Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amtech Systems and Sumco Corp 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 Sumco Corp ADR are associated (or correlated) with Amtech Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amtech Systems has no effect on the direction of Sumco Corp i.e., Sumco Corp and Amtech Systems go up and down completely randomly.
Pair Corralation between Sumco Corp and Amtech Systems
Assuming the 90 days horizon Sumco Corp ADR is expected to generate 1.54 times more return on investment than Amtech Systems. However, Sumco Corp is 1.54 times more volatile than Amtech Systems. It trades about 0.02 of its potential returns per unit of risk. Amtech Systems is currently generating about -0.34 per unit of risk. If you would invest 1,475 in Sumco Corp ADR on November 3, 2024 and sell it today you would earn a total of 5.00 from holding Sumco Corp ADR or generate 0.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sumco Corp ADR vs. Amtech Systems
Performance |
| Timeline |
| Sumco Corp ADR |
| Amtech Systems |
Sumco Corp and Amtech Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sumco Corp and Amtech Systems
The main advantage of trading using opposite Sumco Corp and Amtech Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sumco Corp position performs unexpectedly, Amtech Systems 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 Amtech Systems will offset losses from the drop in Amtech Systems' long position.| Sumco Corp vs. Lasertec | Sumco Corp vs. Asm Pacific Technology | Sumco Corp vs. Disco Corp ADR | Sumco Corp vs. Tokyo Electron |
| Amtech Systems vs. Ultra Clean Holdings | Amtech Systems vs. Veeco Instruments | Amtech Systems vs. Cohu Inc | Amtech Systems vs. Onto Innovation |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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