Correlation Between GREENX METALS and Vishay Intertechnology

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

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

Diversification Opportunities for GREENX METALS and Vishay Intertechnology

-0.01

Correlation Coefficient

GREENX METALS  Vishay Intertechnology

Good diversification

The 3 months correlation between GREENX and Vishay is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding GREENX METALS LTD and Vishay Intertechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vishay Intertechnology and GREENX METALS 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 GREENX METALS LTD are associated (or correlated) with Vishay Intertechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vishay Intertechnology has no effect on the direction of GREENX METALS i.e., GREENX METALS and Vishay Intertechnology go up and down completely randomly.

Pair Corralation between GREENX METALS and Vishay Intertechnology

Assuming the 90 days trading horizon GREENX METALS is expected to generate 2.85 times less return on investment than Vishay Intertechnology. In addition to that, GREENX METALS is 1.39 times more volatile than Vishay Intertechnology. It trades about 0.05 of its total potential returns per unit of risk. Vishay Intertechnology is currently generating about 0.18 per unit of volatility. If you would invest  1,468  in Vishay Intertechnology on September 22, 2024 and sell it today you would earn a total of  191.00  from holding Vishay Intertechnology or generate 13.01% return on investment over 90 days.

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

GREENX METALS LTD  vs.  Vishay Intertechnology

GREENX METALS LTD

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in GREENX METALS LTD are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile primary indicators, GREENX METALS may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Vishay Intertechnology

Risk-Adjusted Performance

1 of 100

Weak

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

Pair Trading with GREENX METALS and Vishay Intertechnology

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

The idea behind GREENX METALS LTD and Vishay Intertechnology 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.