Correlation Between Amtech Systems and ERShares Entrepreneurs

Can any of the company-specific risk be diversified away by investing in both Amtech Systems and ERShares Entrepreneurs 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 Amtech Systems and ERShares Entrepreneurs into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Amtech Systems and ERShares Entrepreneurs ETF, you can compare the effects of market volatilities on Amtech Systems and ERShares Entrepreneurs 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 Amtech Systems with a short position of ERShares Entrepreneurs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amtech Systems and ERShares Entrepreneurs.

Diversification Opportunities for Amtech Systems and ERShares Entrepreneurs

-0.34

Correlation Coefficient

Amtech Systems  ERShares Entrepreneurs

Very good diversification

The 3 months correlation between Amtech and ERShares is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Amtech Systems and ERShares Entrepreneurs ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ERShares Entrepreneurs and Amtech Systems 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 Amtech Systems are associated (or correlated) with ERShares Entrepreneurs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ERShares Entrepreneurs has no effect on the direction of Amtech Systems i.e., Amtech Systems and ERShares Entrepreneurs go up and down completely randomly.

Pair Corralation between Amtech Systems and ERShares Entrepreneurs

If you would invest  1,547  in ERShares Entrepreneurs ETF on September 26, 2024 and sell it today you would earn a total of  0.00  from holding ERShares Entrepreneurs ETF or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	2.44%
Values	Daily Returns

Amtech Systems  vs.  ERShares Entrepreneurs ETF

Amtech Systems

Risk-Adjusted Performance

0 of 100

Very Weak

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

ERShares Entrepreneurs

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ERShares Entrepreneurs ETF has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, ERShares Entrepreneurs is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Amtech Systems and ERShares Entrepreneurs

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

The idea behind Amtech Systems and ERShares Entrepreneurs ETF 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.