Correlation Between Veeco Instruments and Amkor Technology
Can any of the company-specific risk be diversified away by investing in both Veeco Instruments and Amkor Technology 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 Amkor Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Veeco Instruments and Amkor Technology, you can compare the effects of market volatilities on Veeco Instruments and Amkor Technology 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 Amkor Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Veeco Instruments and Amkor Technology.
Diversification Opportunities for Veeco Instruments and Amkor Technology
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Veeco and Amkor is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Veeco Instruments and Amkor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amkor Technology 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 Amkor Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amkor Technology has no effect on the direction of Veeco Instruments i.e., Veeco Instruments and Amkor Technology go up and down completely randomly.
Pair Corralation between Veeco Instruments and Amkor Technology
Given the investment horizon of 90 days Veeco Instruments is expected to generate 0.73 times more return on investment than Amkor Technology. However, Veeco Instruments is 1.36 times less risky than Amkor Technology. It trades about -0.2 of its potential returns per unit of risk. Amkor Technology is currently generating about -0.19 per unit of risk. If you would invest 2,923 in Veeco Instruments on August 24, 2024 and sell it today you would lose (246.00) from holding Veeco Instruments or give up 8.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Veeco Instruments vs. Amkor Technology
Performance |
| Timeline |
| Veeco Instruments |
| Amkor Technology |
Veeco Instruments and Amkor Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Veeco Instruments and Amkor Technology
The main advantage of trading using opposite Veeco Instruments and Amkor Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Veeco Instruments position performs unexpectedly, Amkor Technology 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 Amkor Technology will offset losses from the drop in Amkor Technology's long position.| Veeco Instruments vs. Ultra Clean Holdings | Veeco Instruments vs. Cohu Inc | Veeco Instruments vs. Ichor Holdings | Veeco Instruments vs. Entegris |
| Amkor Technology vs. Power Integrations | Amkor Technology vs. Diodes Incorporated | Amkor Technology vs. MACOM Technology Solutions | Amkor Technology vs. Cirrus Logic |
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 Stocks Directory module to find actively traded stocks across global markets.
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