Correlation Between Ostin Technology and Vicor

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

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

Diversification Opportunities for Ostin Technology and Vicor

-0.56

Correlation Coefficient

Ostin Technology  Vicor

Excellent diversification

The 3 months correlation between Ostin and Vicor is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Ostin Technology Group and Vicor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vicor and Ostin Technology 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 Ostin Technology Group are associated (or correlated) with Vicor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vicor has no effect on the direction of Ostin Technology i.e., Ostin Technology and Vicor go up and down completely randomly.

Pair Corralation between Ostin Technology and Vicor

Considering the 90-day investment horizon Ostin Technology Group is expected to under-perform the Vicor. In addition to that, Ostin Technology is 2.63 times more volatile than Vicor. It trades about -0.17 of its total potential returns per unit of risk. Vicor is currently generating about 0.17 per unit of volatility. If you would invest  4,619  in Vicor on August 31, 2024 and sell it today you would earn a total of  702.00  from holding Vicor or generate 15.2% return on investment over 90 days.

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

Ostin Technology Group  vs.  Vicor

Ostin Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ostin Technology Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Vicor

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vicor are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain fundamental indicators, Vicor reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ostin Technology and Vicor

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

The idea behind Ostin Technology Group and Vicor 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.