Correlation Between Ultra Clean and Gelesis Holdings

Can any of the company-specific risk be diversified away by investing in both Ultra Clean and Gelesis Holdings 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 Gelesis Holdings 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 Gelesis Holdings, you can compare the effects of market volatilities on Ultra Clean and Gelesis Holdings 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 Gelesis Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ultra Clean and Gelesis Holdings.

Diversification Opportunities for Ultra Clean and Gelesis Holdings

0.0

Correlation Coefficient

Ultra Clean  Gelesis Holdings

Pay attention - limited upside

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

Pair Corralation between Ultra Clean and Gelesis Holdings

If you would invest  3,649  in Ultra Clean Holdings on October 25, 2024 and sell it today you would earn a total of  195.00  from holding Ultra Clean Holdings or generate 5.34% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Ultra Clean Holdings  vs.  Gelesis Holdings

Ultra Clean Holdings

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ultra Clean Holdings are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Ultra Clean may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Gelesis Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gelesis Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Gelesis Holdings is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Ultra Clean and Gelesis Holdings

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

The idea behind Ultra Clean Holdings and Gelesis Holdings 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.