Correlation Between IPG Photonics and NESNVX

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

By analyzing existing cross correlation between IPG Photonics and NESNVX 115 14 JAN 27, you can compare the effects of market volatilities on IPG Photonics and NESNVX 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 IPG Photonics with a short position of NESNVX. Check out your portfolio center. Please also check ongoing floating volatility patterns of IPG Photonics and NESNVX.

Diversification Opportunities for IPG Photonics and NESNVX

-0.87

Correlation Coefficient

IPG Photonics  NESNVX

Pay attention - limited upside

The 3 months correlation between IPG and NESNVX is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding IPG Photonics and NESNVX 115 14 JAN 27 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NESNVX 115 14 and IPG Photonics 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 IPG Photonics are associated (or correlated) with NESNVX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NESNVX 115 14 has no effect on the direction of IPG Photonics i.e., IPG Photonics and NESNVX go up and down completely randomly.

Pair Corralation between IPG Photonics and NESNVX

Given the investment horizon of 90 days IPG Photonics is expected to under-perform the NESNVX. In addition to that, IPG Photonics is 5.8 times more volatile than NESNVX 115 14 JAN 27. It trades about -0.04 of its total potential returns per unit of risk. NESNVX 115 14 JAN 27 is currently generating about 0.05 per unit of volatility. If you would invest  8,965  in NESNVX 115 14 JAN 27 on December 22, 2024 and sell it today you would earn a total of  374.00  from holding NESNVX 115 14 JAN 27 or generate 4.17% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	41.82%
Values	Daily Returns

IPG Photonics  vs.  NESNVX 115 14 JAN 27

IPG Photonics

Risk-Adjusted Performance

Very Weak

Over the last 90 days IPG Photonics has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

NESNVX 115 14

Risk-Adjusted Performance

Very Weak

Over the last 90 days NESNVX 115 14 JAN 27 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for NESNVX 115 14 JAN 27 investors.

Pair Trading with IPG Photonics and NESNVX

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

The idea behind IPG Photonics and NESNVX 115 14 JAN 27 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.