Correlation Between ULTRA CLEAN and PARAGON GROUP

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

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

Diversification Opportunities for ULTRA CLEAN and PARAGON GROUP

0.0

Correlation Coefficient

ULTRA CLEAN  PARAGON GROUP

Pay attention - limited upside

The 3 months correlation between ULTRA and PARAGON is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ULTRA CLEAN HLDGS and PARAGON GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PARAGON GROUP and ULTRA CLEAN 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 ULTRA CLEAN HLDGS are associated (or correlated) with PARAGON GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PARAGON GROUP has no effect on the direction of ULTRA CLEAN i.e., ULTRA CLEAN and PARAGON GROUP go up and down completely randomly.

Pair Corralation between ULTRA CLEAN and PARAGON GROUP

If you would invest  3,240  in ULTRA CLEAN HLDGS on October 24, 2024 and sell it today you would earn a total of  440.00  from holding ULTRA CLEAN HLDGS or generate 13.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.67%
Values	Daily Returns

ULTRA CLEAN HLDGS  vs.  PARAGON GROUP

ULTRA CLEAN HLDGS

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ULTRA CLEAN HLDGS are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, ULTRA CLEAN exhibited solid returns over the last few months and may actually be approaching a breakup point.

PARAGON GROUP

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with ULTRA CLEAN and PARAGON GROUP

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

The idea behind ULTRA CLEAN HLDGS and PARAGON GROUP 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.