Correlation Between Axcelis Technologies and Shimano
Can any of the company-specific risk be diversified away by investing in both Axcelis Technologies and Shimano 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 Axcelis Technologies and Shimano into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axcelis Technologies and Shimano, you can compare the effects of market volatilities on Axcelis Technologies and Shimano 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 Axcelis Technologies with a short position of Shimano. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axcelis Technologies and Shimano.
Diversification Opportunities for Axcelis Technologies and Shimano
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Axcelis and Shimano is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Axcelis Technologies and Shimano in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shimano and Axcelis Technologies 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 Axcelis Technologies are associated (or correlated) with Shimano. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shimano has no effect on the direction of Axcelis Technologies i.e., Axcelis Technologies and Shimano go up and down completely randomly.
Pair Corralation between Axcelis Technologies and Shimano
Assuming the 90 days trading horizon Axcelis Technologies is expected to under-perform the Shimano. In addition to that, Axcelis Technologies is 1.93 times more volatile than Shimano. It trades about -0.05 of its total potential returns per unit of risk. Shimano is currently generating about -0.05 per unit of volatility. If you would invest 15,450 in Shimano on September 3, 2024 and sell it today you would lose (2,290) from holding Shimano or give up 14.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Axcelis Technologies vs. Shimano
Performance |
| Timeline |
| Axcelis Technologies |
| Shimano |
Axcelis Technologies and Shimano Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axcelis Technologies and Shimano
The main advantage of trading using opposite Axcelis Technologies and Shimano positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axcelis Technologies position performs unexpectedly, Shimano 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 Shimano will offset losses from the drop in Shimano's long position.| Axcelis Technologies vs. Tower One Wireless | Axcelis Technologies vs. FORWARD AIR P | Axcelis Technologies vs. Corsair Gaming | Axcelis Technologies vs. MTI WIRELESS EDGE |
| Shimano vs. G8 EDUCATION | Shimano vs. STRAYER EDUCATION | Shimano vs. Digilife Technologies Limited | Shimano vs. Axcelis Technologies |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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