Correlation Between Focus Universal and Cohu
Can any of the company-specific risk be diversified away by investing in both Focus Universal and Cohu 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 Focus Universal and Cohu into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Focus Universal and Cohu Inc, you can compare the effects of market volatilities on Focus Universal and Cohu 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 Focus Universal with a short position of Cohu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Focus Universal and Cohu.
Diversification Opportunities for Focus Universal and Cohu
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Focus and Cohu is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Focus Universal and Cohu Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohu Inc and Focus Universal 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 Focus Universal are associated (or correlated) with Cohu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cohu Inc has no effect on the direction of Focus Universal i.e., Focus Universal and Cohu go up and down completely randomly.
Pair Corralation between Focus Universal and Cohu
Given the investment horizon of 90 days Focus Universal is expected to generate 5.59 times more return on investment than Cohu. However, Focus Universal is 5.59 times more volatile than Cohu Inc. It trades about 0.02 of its potential returns per unit of risk. Cohu Inc is currently generating about -0.04 per unit of risk. If you would invest 1,790 in Focus Universal on November 9, 2024 and sell it today you would lose (1,304) from holding Focus Universal or give up 72.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Focus Universal vs. Cohu Inc
Performance |
| Timeline |
| Focus Universal |
| Cohu Inc |
Focus Universal and Cohu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Focus Universal and Cohu
The main advantage of trading using opposite Focus Universal and Cohu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Focus Universal position performs unexpectedly, Cohu 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 Cohu will offset losses from the drop in Cohu's long position.| Focus Universal vs. ESCO Technologies | Focus Universal vs. Genasys | Focus Universal vs. Know Labs | Focus Universal vs. Sono Tek Corp |
| Cohu vs. Onto Innovation | Cohu vs. Photronics | Cohu vs. Ultra Clean Holdings | Cohu vs. Axcelis Technologies |
Check out your portfolio center.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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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