Correlation Between Amkor Technology and CareCloud

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

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

Diversification Opportunities for Amkor Technology and CareCloud

-0.12

Correlation Coefficient

Amkor Technology  CareCloud

Good diversification

The 3 months correlation between Amkor and CareCloud is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Amkor Technology and CareCloud in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CareCloud and Amkor Technology 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 Amkor Technology are associated (or correlated) with CareCloud. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CareCloud has no effect on the direction of Amkor Technology i.e., Amkor Technology and CareCloud go up and down completely randomly.

Pair Corralation between Amkor Technology and CareCloud

If you would invest  3,082  in Amkor Technology on February 5, 2024 and sell it today you would earn a total of  152.00  from holding Amkor Technology or generate 4.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	4.55%
Values	Daily Returns

Amkor Technology  vs.  CareCloud

Amkor Technology

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Amkor Technology are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable forward-looking signals, Amkor Technology is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

CareCloud

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Amkor Technology and CareCloud

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

The idea behind Amkor Technology and CareCloud 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.