Correlation Between Thermon Group and Vishay Precision
Can any of the company-specific risk be diversified away by investing in both Thermon Group 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 Thermon Group and Vishay Precision into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thermon Group Holdings and Vishay Precision Group, you can compare the effects of market volatilities on Thermon Group 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 Thermon Group with a short position of Vishay Precision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thermon Group and Vishay Precision.
Diversification Opportunities for Thermon Group and Vishay Precision
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Thermon and Vishay is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Thermon Group Holdings and Vishay Precision Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vishay Precision and Thermon Group 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 Thermon Group Holdings 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 Thermon Group i.e., Thermon Group and Vishay Precision go up and down completely randomly.
Pair Corralation between Thermon Group and Vishay Precision
Considering the 90-day investment horizon Thermon Group Holdings is expected to generate 1.0 times more return on investment than Vishay Precision. However, Thermon Group is 1.0 times more volatile than Vishay Precision Group. It trades about 0.06 of its potential returns per unit of risk. Vishay Precision Group is currently generating about -0.12 per unit of risk. If you would invest 3,024 in Thermon Group Holdings on August 28, 2024 and sell it today you would earn a total of 200.00 from holding Thermon Group Holdings or generate 6.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thermon Group Holdings vs. Vishay Precision Group
Performance |
| Timeline |
| Thermon Group Holdings |
| Vishay Precision |
Thermon Group and Vishay Precision Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thermon Group and Vishay Precision
The main advantage of trading using opposite Thermon Group and Vishay Precision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thermon Group 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.| Thermon Group vs. Hurco Companies | Thermon Group vs. Enerpac Tool Group | Thermon Group vs. Enpro Industries | Thermon Group vs. Omega Flex |
| Vishay Precision vs. Spectris plc | Vishay Precision vs. Mesa Laboratories | Vishay Precision vs. ESCO Technologies | Vishay Precision vs. Focus Universal |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |