Correlation Between Amkor Technology and Acme United

Can any of the company-specific risk be diversified away by investing in both Amkor Technology and Acme United 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 Amkor Technology and Acme United into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Amkor Technology and Acme United, you can compare the effects of market volatilities on Amkor Technology and Acme United 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 Amkor Technology with a short position of Acme United. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amkor Technology and Acme United.

Diversification Opportunities for Amkor Technology and Acme United

0.1

Correlation Coefficient

Amkor Technology  Acme United

Average diversification

The 3 months correlation between Amkor and Acme is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Amkor Technology and Acme United in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acme United and Amkor Technology 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 Amkor Technology are associated (or correlated) with Acme United. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acme United has no effect on the direction of Amkor Technology i.e., Amkor Technology and Acme United go up and down completely randomly.

Pair Corralation between Amkor Technology and Acme United

Given the investment horizon of 90 days Amkor Technology is expected to under-perform the Acme United. In addition to that, Amkor Technology is 1.27 times more volatile than Acme United. It trades about -0.08 of its total potential returns per unit of risk. Acme United is currently generating about 0.03 per unit of volatility. If you would invest  3,449  in Acme United on September 29, 2024 and sell it today you would earn a total of  233.00  from holding Acme United or generate 6.76% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Amkor Technology  vs.  Acme United

Amkor Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amkor Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest inconsistent performance, the Stock's forward-looking signals remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Acme United

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Acme United has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's fundamental indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Amkor Technology and Acme United

The main advantage of trading using opposite Amkor Technology and Acme United positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amkor Technology position performs unexpectedly, Acme United 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 Acme United will offset losses from the drop in Acme United's long position.

The idea behind Amkor Technology and Acme United pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.