Correlation Between Vishay Precision and Mistras
Can any of the company-specific risk be diversified away by investing in both Vishay Precision and Mistras 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 Vishay Precision and Mistras into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vishay Precision Group and Mistras Group, you can compare the effects of market volatilities on Vishay Precision and Mistras 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 Vishay Precision with a short position of Mistras. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vishay Precision and Mistras.
Diversification Opportunities for Vishay Precision and Mistras
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Vishay and Mistras is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Vishay Precision Group and Mistras Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mistras Group and Vishay Precision 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 Vishay Precision Group are associated (or correlated) with Mistras. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mistras Group has no effect on the direction of Vishay Precision i.e., Vishay Precision and Mistras go up and down completely randomly.
Pair Corralation between Vishay Precision and Mistras
Considering the 90-day investment horizon Vishay Precision Group is expected to under-perform the Mistras. But the stock apears to be less risky and, when comparing its historical volatility, Vishay Precision Group is 1.45 times less risky than Mistras. The stock trades about -0.05 of its potential returns per unit of risk. The Mistras Group is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 710.00 in Mistras Group on August 27, 2024 and sell it today you would earn a total of 217.00 from holding Mistras Group or generate 30.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vishay Precision Group vs. Mistras Group
Performance |
| Timeline |
| Vishay Precision |
| Mistras Group |
Vishay Precision and Mistras Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vishay Precision and Mistras
The main advantage of trading using opposite Vishay Precision and Mistras positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vishay Precision position performs unexpectedly, Mistras 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 Mistras will offset losses from the drop in Mistras' long position.| Vishay Precision vs. Spectris plc | Vishay Precision vs. Mesa Laboratories | Vishay Precision vs. ESCO Technologies | Vishay Precision vs. Focus Universal |
| Mistras vs. Franklin Covey | Mistras vs. TransUnion | Mistras vs. ICF International | Mistras vs. Huron Consulting Group |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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