Correlation Between Ultra Clean and California Engels

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

By analyzing existing cross correlation between Ultra Clean Holdings and California Engels Mining, you can compare the effects of market volatilities on Ultra Clean and California Engels 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 California Engels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ultra Clean and California Engels.

Diversification Opportunities for Ultra Clean and California Engels

0.0

Correlation Coefficient

Ultra Clean  California Engels

Pay attention - limited upside

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

Pair Corralation between Ultra Clean and California Engels

If you would invest  3,839  in Ultra Clean Holdings on October 10, 2024 and sell it today you would earn a total of  74.00  from holding Ultra Clean Holdings or generate 1.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	96.83%
Values	Daily Returns

Ultra Clean Holdings  vs.  California Engels Mining

Ultra Clean Holdings

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ultra Clean Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Ultra Clean is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

California Engels Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days California Engels Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, California Engels is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Ultra Clean and California Engels

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

The idea behind Ultra Clean Holdings and California Engels Mining 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.