Correlation Between ASM Pacific and Kulicke

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Can any of the company-specific risk be diversified away by investing in both ASM Pacific and Kulicke 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 ASM Pacific and Kulicke into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASM Pacific Technology and Kulicke and Soffa, you can compare the effects of market volatilities on ASM Pacific and Kulicke 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 ASM Pacific with a short position of Kulicke. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASM Pacific and Kulicke.

Diversification Opportunities for ASM Pacific and Kulicke

0.3
  Correlation Coefficient

Weak diversification

The 3 months correlation between ASM and Kulicke is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding ASM Pacific Technology and Kulicke and Soffa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kulicke and Soffa and ASM Pacific 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 ASM Pacific Technology are associated (or correlated) with Kulicke. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kulicke and Soffa has no effect on the direction of ASM Pacific i.e., ASM Pacific and Kulicke go up and down completely randomly.

Pair Corralation between ASM Pacific and Kulicke

If you would invest  1,252  in ASM Pacific Technology on October 1, 2024 and sell it today you would earn a total of  0.00  from holding ASM Pacific Technology or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy4.76%
ValuesDaily Returns

ASM Pacific Technology  vs.  Kulicke and Soffa

 Performance 
       Timeline  
ASM Pacific Technology 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days ASM Pacific Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, ASM Pacific is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.
Kulicke and Soffa 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Kulicke and Soffa are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain forward indicators, Kulicke may actually be approaching a critical reversion point that can send shares even higher in January 2025.

ASM Pacific and Kulicke Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with ASM Pacific and Kulicke

The main advantage of trading using opposite ASM Pacific and Kulicke positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASM Pacific position performs unexpectedly, Kulicke 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 Kulicke will offset losses from the drop in Kulicke's long position.
The idea behind ASM Pacific Technology and Kulicke and Soffa 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.
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.

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