Correlation Between Camtek and Trio Tech

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

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

Diversification Opportunities for Camtek and Trio Tech

-0.64

Correlation Coefficient

Camtek  Trio Tech

Excellent diversification

The 3 months correlation between Camtek and Trio is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Camtek and Trio Tech International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trio Tech International and Camtek 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 Camtek are associated (or correlated) with Trio Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trio Tech International has no effect on the direction of Camtek i.e., Camtek and Trio Tech go up and down completely randomly.

Pair Corralation between Camtek and Trio Tech

Given the investment horizon of 90 days Camtek is expected to under-perform the Trio Tech. In addition to that, Camtek is 1.31 times more volatile than Trio Tech International. It trades about -0.14 of its total potential returns per unit of risk. Trio Tech International is currently generating about -0.01 per unit of volatility. If you would invest  604.00  in Trio Tech International on November 28, 2024 and sell it today you would lose (6.00) from holding Trio Tech International or give up 0.99% of portfolio value over 90 days.

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

Camtek  vs.  Trio Tech International

Camtek

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Camtek are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating primary indicators, Camtek may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Trio Tech International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Trio Tech International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in March 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Camtek and Trio Tech

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

The idea behind Camtek and Trio Tech International 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.