Correlation Between Evertz Technologies and Kulicke

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

By analyzing existing cross correlation between Evertz Technologies Limited and Kulicke and Soffa, you can compare the effects of market volatilities on Evertz Technologies 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 Evertz Technologies with a short position of Kulicke. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evertz Technologies and Kulicke.

Diversification Opportunities for Evertz Technologies and Kulicke

-0.27

Correlation Coefficient

Evertz Technologies  Kulicke

Very good diversification

The 3 months correlation between Evertz and Kulicke is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Evertz Technologies Limited 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 Evertz 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 Evertz Technologies Limited 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 Evertz Technologies i.e., Evertz Technologies and Kulicke go up and down completely randomly.

Pair Corralation between Evertz Technologies and Kulicke

Assuming the 90 days horizon Evertz Technologies Limited is expected to generate 0.65 times more return on investment than Kulicke. However, Evertz Technologies Limited is 1.54 times less risky than Kulicke. It trades about -0.05 of its potential returns per unit of risk. Kulicke and Soffa is currently generating about -0.23 per unit of risk. If you would invest  853.00  in Evertz Technologies Limited on October 13, 2024 and sell it today you would lose (9.00) from holding Evertz Technologies Limited or give up 1.06% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.0%
Values	Daily Returns

Evertz Technologies Limited  vs.  Kulicke and Soffa

Evertz Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Evertz Technologies Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Evertz Technologies is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Kulicke and Soffa

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Kulicke and Soffa has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound forward indicators, Kulicke is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Evertz Technologies and Kulicke

The main advantage of trading using opposite Evertz Technologies and Kulicke positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evertz Technologies 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 Evertz Technologies Limited 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 Global Correlations module to find global opportunities by holding instruments from different markets.