Correlation Between Axcelis Technologies and Universal

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

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

Diversification Opportunities for Axcelis Technologies and Universal

0.03

Correlation Coefficient

Axcelis Technologies  Universal

Significant diversification

The 3 months correlation between Axcelis and Universal is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Axcelis Technologies and Universal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal and Axcelis Technologies 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 Axcelis Technologies are associated (or correlated) with Universal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal has no effect on the direction of Axcelis Technologies i.e., Axcelis Technologies and Universal go up and down completely randomly.

Pair Corralation between Axcelis Technologies and Universal

Given the investment horizon of 90 days Axcelis Technologies is expected to generate 4.81 times less return on investment than Universal. In addition to that, Axcelis Technologies is 2.65 times more volatile than Universal. It trades about 0.01 of its total potential returns per unit of risk. Universal is currently generating about 0.11 per unit of volatility. If you would invest  5,192  in Universal on February 18, 2025 and sell it today you would earn a total of  522.00  from holding Universal or generate 10.05% return on investment over 90 days.

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

Axcelis Technologies  vs.  Universal

Axcelis Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Axcelis Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, Axcelis Technologies is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Universal

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Universal are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Universal may actually be approaching a critical reversion point that can send shares even higher in June 2025.

Pair Trading with Axcelis Technologies and Universal

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

The idea behind Axcelis Technologies and Universal 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.