Correlation Between Y Optics and Wysiwyg Studios

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

By analyzing existing cross correlation between Y Optics Manufacture Co and Wysiwyg Studios Co, you can compare the effects of market volatilities on Y Optics and Wysiwyg Studios 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 Y Optics with a short position of Wysiwyg Studios. Check out your portfolio center. Please also check ongoing floating volatility patterns of Y Optics and Wysiwyg Studios.

Diversification Opportunities for Y Optics and Wysiwyg Studios

-0.2

Correlation Coefficient

Y Optics  Wysiwyg Studios

Good diversification

The 3 months correlation between 066430 and Wysiwyg is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Y Optics Manufacture Co and Wysiwyg Studios Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wysiwyg Studios and Y Optics 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 Y Optics Manufacture Co are associated (or correlated) with Wysiwyg Studios. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wysiwyg Studios has no effect on the direction of Y Optics i.e., Y Optics and Wysiwyg Studios go up and down completely randomly.

Pair Corralation between Y Optics and Wysiwyg Studios

Assuming the 90 days trading horizon Y Optics Manufacture Co is expected to generate 0.77 times more return on investment than Wysiwyg Studios. However, Y Optics Manufacture Co is 1.3 times less risky than Wysiwyg Studios. It trades about 0.27 of its potential returns per unit of risk. Wysiwyg Studios Co is currently generating about -0.18 per unit of risk. If you would invest  54,500  in Y Optics Manufacture Co on December 24, 2024 and sell it today you would earn a total of  33,900  from holding Y Optics Manufacture Co or generate 62.2% return on investment over 90 days.

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

Y Optics Manufacture Co  vs.  Wysiwyg Studios Co

Y Optics Manufacture

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Y Optics Manufacture Co are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Y Optics sustained solid returns over the last few months and may actually be approaching a breakup point.

Wysiwyg Studios

Risk-Adjusted Performance

Very Weak

Over the last 90 days Wysiwyg Studios Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Y Optics and Wysiwyg Studios

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

The idea behind Y Optics Manufacture Co and Wysiwyg Studios Co 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.