Correlation Between ULTRA CLEAN and ANTA SPORTS
Can any of the company-specific risk be diversified away by investing in both ULTRA CLEAN and ANTA SPORTS 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 ULTRA CLEAN and ANTA SPORTS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ULTRA CLEAN HLDGS and ANTA SPORTS PRODUCT, you can compare the effects of market volatilities on ULTRA CLEAN and ANTA SPORTS 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 ULTRA CLEAN with a short position of ANTA SPORTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of ULTRA CLEAN and ANTA SPORTS.
Diversification Opportunities for ULTRA CLEAN and ANTA SPORTS
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ULTRA and ANTA is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding ULTRA CLEAN HLDGS and ANTA SPORTS PRODUCT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANTA SPORTS PRODUCT and ULTRA CLEAN 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 ULTRA CLEAN HLDGS are associated (or correlated) with ANTA SPORTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANTA SPORTS PRODUCT has no effect on the direction of ULTRA CLEAN i.e., ULTRA CLEAN and ANTA SPORTS go up and down completely randomly.
Pair Corralation between ULTRA CLEAN and ANTA SPORTS
Assuming the 90 days trading horizon ULTRA CLEAN is expected to generate 2.27 times less return on investment than ANTA SPORTS. But when comparing it to its historical volatility, ULTRA CLEAN HLDGS is 1.35 times less risky than ANTA SPORTS. It trades about 0.06 of its potential returns per unit of risk. ANTA SPORTS PRODUCT is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 736.00 in ANTA SPORTS PRODUCT on August 28, 2024 and sell it today you would earn a total of 199.00 from holding ANTA SPORTS PRODUCT or generate 27.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ULTRA CLEAN HLDGS vs. ANTA SPORTS PRODUCT
Performance |
| Timeline |
| ULTRA CLEAN HLDGS |
| ANTA SPORTS PRODUCT |
ULTRA CLEAN and ANTA SPORTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ULTRA CLEAN and ANTA SPORTS
The main advantage of trading using opposite ULTRA CLEAN and ANTA SPORTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ULTRA CLEAN position performs unexpectedly, ANTA SPORTS 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 ANTA SPORTS will offset losses from the drop in ANTA SPORTS's long position.| ULTRA CLEAN vs. GREENX METALS LTD | ULTRA CLEAN vs. Gaztransport Technigaz SA | ULTRA CLEAN vs. TITANIUM TRANSPORTGROUP | ULTRA CLEAN vs. FIREWEED METALS P |
| ANTA SPORTS vs. Apple Inc | ANTA SPORTS vs. Apple Inc | ANTA SPORTS vs. Microsoft | ANTA SPORTS vs. Microsoft |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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