Correlation Between Veeco Instruments and Axcelis Technologies
Can any of the company-specific risk be diversified away by investing in both Veeco Instruments and Axcelis Technologies 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 Veeco Instruments and Axcelis Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Veeco Instruments and Axcelis Technologies, you can compare the effects of market volatilities on Veeco Instruments and Axcelis Technologies 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 Veeco Instruments with a short position of Axcelis Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Veeco Instruments and Axcelis Technologies.
Diversification Opportunities for Veeco Instruments and Axcelis Technologies
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Veeco and Axcelis is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Veeco Instruments and Axcelis Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axcelis Technologies and Veeco Instruments 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 Veeco Instruments are associated (or correlated) with Axcelis Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axcelis Technologies has no effect on the direction of Veeco Instruments i.e., Veeco Instruments and Axcelis Technologies go up and down completely randomly.
Pair Corralation between Veeco Instruments and Axcelis Technologies
Given the investment horizon of 90 days Veeco Instruments is expected to under-perform the Axcelis Technologies. In addition to that, Veeco Instruments is 1.48 times more volatile than Axcelis Technologies. It trades about -0.23 of its total potential returns per unit of risk. Axcelis Technologies is currently generating about -0.26 per unit of volatility. If you would invest 7,445 in Axcelis Technologies on November 5, 2024 and sell it today you would lose (645.00) from holding Axcelis Technologies or give up 8.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Veeco Instruments vs. Axcelis Technologies
Performance |
| Timeline |
| Veeco Instruments |
| Axcelis Technologies |
Veeco Instruments and Axcelis Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Veeco Instruments and Axcelis Technologies
The main advantage of trading using opposite Veeco Instruments and Axcelis Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Veeco Instruments position performs unexpectedly, Axcelis Technologies 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 Axcelis Technologies will offset losses from the drop in Axcelis Technologies' long position.| Veeco Instruments vs. NVE Corporation | Veeco Instruments vs. Photronics | Veeco Instruments vs. Kulicke and Soffa | Veeco Instruments vs. Alvarium Tiedemann Holdings |
| Axcelis Technologies vs. inTest | Axcelis Technologies vs. Lam Research Corp | Axcelis Technologies vs. Photronics | Axcelis Technologies vs. indie Semiconductor |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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