Correlation Between Coda Octopus and Vishay Precision

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Can any of the company-specific risk be diversified away by investing in both Coda Octopus and Vishay Precision 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 Coda Octopus and Vishay Precision into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coda Octopus Group and Vishay Precision Group, you can compare the effects of market volatilities on Coda Octopus and Vishay Precision 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 Coda Octopus with a short position of Vishay Precision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coda Octopus and Vishay Precision.

Diversification Opportunities for Coda Octopus and Vishay Precision

CodaVishayDiversified AwayCodaVishayDiversified Away100%
0.28
  Correlation Coefficient

Modest diversification

The 3 months correlation between Coda and Vishay is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Coda Octopus Group and Vishay Precision Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vishay Precision and Coda Octopus 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 Coda Octopus Group are associated (or correlated) with Vishay Precision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vishay Precision has no effect on the direction of Coda Octopus i.e., Coda Octopus and Vishay Precision go up and down completely randomly.

Pair Corralation between Coda Octopus and Vishay Precision

Given the investment horizon of 90 days Coda Octopus Group is expected to generate 1.08 times more return on investment than Vishay Precision. However, Coda Octopus is 1.08 times more volatile than Vishay Precision Group. It trades about 0.03 of its potential returns per unit of risk. Vishay Precision Group is currently generating about -0.07 per unit of risk. If you would invest  600.00  in Coda Octopus Group on December 14, 2024 and sell it today you would earn a total of  65.00  from holding Coda Octopus Group or generate 10.83% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Coda Octopus Group  vs.  Vishay Precision Group

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -25-20-15-10-50510
JavaScript chart by amCharts 3.21.15CODA VPG
       Timeline  
Coda Octopus Group 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Coda Octopus Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's fundamental indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.
JavaScript chart by amCharts 3.21.15JanFebMarFebMar6.577.588.59
Vishay Precision 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Vishay Precision Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.
JavaScript chart by amCharts 3.21.15JanFebMarFebMar21222324252627

Coda Octopus and Vishay Precision Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-4.1-3.07-2.04-1.010.00.851.722.583.45 0.0500.0550.0600.0650.070
JavaScript chart by amCharts 3.21.15CODA VPG
       Returns  

Pair Trading with Coda Octopus and Vishay Precision

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

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