Correlation Between ULTRA CLEAN and Natural Health
Can any of the company-specific risk be diversified away by investing in both ULTRA CLEAN and Natural Health 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 Natural Health 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 Natural Health Trends, you can compare the effects of market volatilities on ULTRA CLEAN and Natural Health 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 Natural Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of ULTRA CLEAN and Natural Health.
Diversification Opportunities for ULTRA CLEAN and Natural Health
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ULTRA and Natural is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding ULTRA CLEAN HLDGS and Natural Health Trends in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natural Health Trends 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 Natural Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natural Health Trends has no effect on the direction of ULTRA CLEAN i.e., ULTRA CLEAN and Natural Health go up and down completely randomly.
Pair Corralation between ULTRA CLEAN and Natural Health
Assuming the 90 days trading horizon ULTRA CLEAN HLDGS is expected to generate 1.09 times more return on investment than Natural Health. However, ULTRA CLEAN is 1.09 times more volatile than Natural Health Trends. It trades about 0.06 of its potential returns per unit of risk. Natural Health Trends is currently generating about -0.46 per unit of risk. If you would invest 3,440 in ULTRA CLEAN HLDGS on September 12, 2024 and sell it today you would earn a total of 100.00 from holding ULTRA CLEAN HLDGS or generate 2.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ULTRA CLEAN HLDGS vs. Natural Health Trends
Performance |
| Timeline |
| ULTRA CLEAN HLDGS |
| Natural Health Trends |
ULTRA CLEAN and Natural Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ULTRA CLEAN and Natural Health
The main advantage of trading using opposite ULTRA CLEAN and Natural Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ULTRA CLEAN position performs unexpectedly, Natural Health 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 Natural Health will offset losses from the drop in Natural Health's long position.| ULTRA CLEAN vs. WillScot Mobile Mini | ULTRA CLEAN vs. Tower One Wireless | ULTRA CLEAN vs. Ribbon Communications | ULTRA CLEAN vs. T MOBILE US |
| Natural Health vs. Lendlease Group | Natural Health vs. FUYO GENERAL LEASE | Natural Health vs. Ares Management Corp | Natural Health vs. INVITATION HOMES DL |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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