Correlation Between Corning Incorporated and Vicor
Can any of the company-specific risk be diversified away by investing in both Corning Incorporated 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 Corning Incorporated and Vicor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Corning Incorporated and Vicor, you can compare the effects of market volatilities on Corning Incorporated 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 Corning Incorporated with a short position of Vicor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Corning Incorporated and Vicor.
Diversification Opportunities for Corning Incorporated and Vicor
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Corning and Vicor is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Corning Incorporated and Vicor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vicor and Corning Incorporated 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 Corning Incorporated 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 Corning Incorporated i.e., Corning Incorporated and Vicor go up and down completely randomly.
Pair Corralation between Corning Incorporated and Vicor
Considering the 90-day investment horizon Corning Incorporated is expected to generate 0.53 times more return on investment than Vicor. However, Corning Incorporated is 1.9 times less risky than Vicor. It trades about 0.17 of its potential returns per unit of risk. Vicor is currently generating about 0.03 per unit of risk. If you would invest 4,750 in Corning Incorporated on November 4, 2024 and sell it today you would earn a total of 458.00 from holding Corning Incorporated or generate 9.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Corning Incorporated vs. Vicor
Performance |
| Timeline |
| Corning Incorporated |
| Vicor |
Corning Incorporated and Vicor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Corning Incorporated and Vicor
The main advantage of trading using opposite Corning Incorporated and Vicor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Corning Incorporated 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.| Corning Incorporated vs. OSI Systems | Corning Incorporated vs. Fabrinet | Corning Incorporated vs. Jabil Circuit | Corning Incorporated vs. Vicor |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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