Correlation Between Intevac and TTM Technologies

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

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

Diversification Opportunities for Intevac and TTM Technologies

-0.6

Correlation Coefficient

Intevac  TTM Technologies

Excellent diversification

The 3 months correlation between Intevac and TTM is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Intevac and TTM Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TTM Technologies and Intevac 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 Intevac are associated (or correlated) with TTM Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TTM Technologies has no effect on the direction of Intevac i.e., Intevac and TTM Technologies go up and down completely randomly.

Pair Corralation between Intevac and TTM Technologies

Given the investment horizon of 90 days Intevac is expected to generate 1.14 times more return on investment than TTM Technologies. However, Intevac is 1.14 times more volatile than TTM Technologies. It trades about 0.12 of its potential returns per unit of risk. TTM Technologies is currently generating about -0.08 per unit of risk. If you would invest  335.00  in Intevac on December 28, 2024 and sell it today you would earn a total of  65.00  from holding Intevac or generate 19.4% return on investment over 90 days.

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

Intevac  vs.  TTM Technologies

Intevac

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Intevac are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Intevac exhibited solid returns over the last few months and may actually be approaching a breakup point.

TTM Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days TTM Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's primary indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with Intevac and TTM Technologies

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

The idea behind Intevac and TTM Technologies 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.