Correlation Between Sono Tek and Nanophase Technol
Can any of the company-specific risk be diversified away by investing in both Sono Tek and Nanophase Technol 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 Sono Tek and Nanophase Technol into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sono Tek Corp and Nanophase Technol, you can compare the effects of market volatilities on Sono Tek and Nanophase Technol 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 Sono Tek with a short position of Nanophase Technol. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sono Tek and Nanophase Technol.
Diversification Opportunities for Sono Tek and Nanophase Technol
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sono and Nanophase is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Sono Tek Corp and Nanophase Technol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanophase Technol and Sono Tek 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 Sono Tek Corp are associated (or correlated) with Nanophase Technol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanophase Technol has no effect on the direction of Sono Tek i.e., Sono Tek and Nanophase Technol go up and down completely randomly.
Pair Corralation between Sono Tek and Nanophase Technol
If you would invest 426.00 in Sono Tek Corp on September 1, 2024 and sell it today you would earn a total of 48.00 from holding Sono Tek Corp or generate 11.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Sono Tek Corp vs. Nanophase Technol
Performance |
| Timeline |
| Sono Tek Corp |
| Nanophase Technol |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Sono Tek and Nanophase Technol Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sono Tek and Nanophase Technol
The main advantage of trading using opposite Sono Tek and Nanophase Technol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sono Tek position performs unexpectedly, Nanophase Technol 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 Nanophase Technol will offset losses from the drop in Nanophase Technol's long position.| Sono Tek vs. Novanta | Sono Tek vs. ESCO Technologies | Sono Tek vs. Vontier Corp | Sono Tek vs. Sensata Technologies Holding |
| Nanophase Technol vs. Iofina plc | Nanophase Technol vs. Green Star Products | Nanophase Technol vs. Greystone Logistics | Nanophase Technol vs. Crown Electrokinetics Corp |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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