Correlation Between Kopin and Neonode

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

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

Diversification Opportunities for Kopin and Neonode

-0.32

Correlation Coefficient

Kopin  Neonode

Very good diversification

The 3 months correlation between Kopin and Neonode is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Kopin and Neonode in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neonode and Kopin 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 Kopin are associated (or correlated) with Neonode. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neonode has no effect on the direction of Kopin i.e., Kopin and Neonode go up and down completely randomly.

Pair Corralation between Kopin and Neonode

Given the investment horizon of 90 days Kopin is expected to generate 0.81 times more return on investment than Neonode. However, Kopin is 1.23 times less risky than Neonode. It trades about 0.11 of its potential returns per unit of risk. Neonode is currently generating about 0.08 per unit of risk. If you would invest  87.00  in Kopin on September 4, 2024 and sell it today you would earn a total of  30.00  from holding Kopin or generate 34.48% return on investment over 90 days.

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

Kopin  vs.  Neonode

Kopin

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kopin are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Kopin displayed solid returns over the last few months and may actually be approaching a breakup point.

Neonode

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Neonode are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent basic indicators, Neonode displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kopin and Neonode

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

The idea behind Kopin and Neonode 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.