Correlation Between Veeco Instruments and Entegris
Can any of the company-specific risk be diversified away by investing in both Veeco Instruments and Entegris 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 Entegris into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Veeco Instruments and Entegris, you can compare the effects of market volatilities on Veeco Instruments and Entegris 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 Entegris. Check out your portfolio center. Please also check ongoing floating volatility patterns of Veeco Instruments and Entegris.
Diversification Opportunities for Veeco Instruments and Entegris
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Veeco and Entegris is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Veeco Instruments and Entegris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Entegris 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 Entegris. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Entegris has no effect on the direction of Veeco Instruments i.e., Veeco Instruments and Entegris go up and down completely randomly.
Pair Corralation between Veeco Instruments and Entegris
Given the investment horizon of 90 days Veeco Instruments is expected to under-perform the Entegris. But the stock apears to be less risky and, when comparing its historical volatility, Veeco Instruments is 1.02 times less risky than Entegris. The stock trades about -0.07 of its potential returns per unit of risk. The Entegris is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 10,705 in Entegris on November 1, 2024 and sell it today you would lose (528.00) from holding Entegris or give up 4.93% 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. Entegris
Performance |
| Timeline |
| Veeco Instruments |
| Entegris |
Veeco Instruments and Entegris Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Veeco Instruments and Entegris
The main advantage of trading using opposite Veeco Instruments and Entegris positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Veeco Instruments position performs unexpectedly, Entegris 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 Entegris will offset losses from the drop in Entegris' long position.| Veeco Instruments vs. NVE Corporation | Veeco Instruments vs. Photronics | Veeco Instruments vs. Kulicke and Soffa | Veeco Instruments vs. Alvarium Tiedemann Holdings |
| Entegris vs. Teradyne | Entegris vs. Ichor Holdings | Entegris vs. Amtech Systems | Entegris vs. Veeco Instruments |
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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