Correlation Between Vishay Precision and WPLAU

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

By analyzing existing cross correlation between Vishay Precision Group and WPLAU 365 05 MAR 25, you can compare the effects of market volatilities on Vishay Precision and WPLAU 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 Vishay Precision with a short position of WPLAU. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vishay Precision and WPLAU.

Diversification Opportunities for Vishay Precision and WPLAU

-0.3

Correlation Coefficient

Vishay Precision  WPLAU

Very good diversification

The 3 months correlation between Vishay and WPLAU is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Vishay Precision Group and WPLAU 365 05 MAR 25 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WPLAU 365 05 and Vishay Precision 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 Vishay Precision Group are associated (or correlated) with WPLAU. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WPLAU 365 05 has no effect on the direction of Vishay Precision i.e., Vishay Precision and WPLAU go up and down completely randomly.

Pair Corralation between Vishay Precision and WPLAU

Considering the 90-day investment horizon Vishay Precision Group is expected to under-perform the WPLAU. In addition to that, Vishay Precision is 7.33 times more volatile than WPLAU 365 05 MAR 25. It trades about -0.05 of its total potential returns per unit of risk. WPLAU 365 05 MAR 25 is currently generating about 0.06 per unit of volatility. If you would invest  9,739  in WPLAU 365 05 MAR 25 on October 22, 2024 and sell it today you would earn a total of  249.00  from holding WPLAU 365 05 MAR 25 or generate 2.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	32.06%
Values	Daily Returns

Vishay Precision Group  vs.  WPLAU 365 05 MAR 25

Vishay Precision

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Vishay Precision Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Vishay Precision is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

WPLAU 365 05

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in WPLAU 365 05 MAR 25 are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, WPLAU is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Vishay Precision and WPLAU

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

The idea behind Vishay Precision Group and WPLAU 365 05 MAR 25 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.