Correlation Between Vishay Precision and Microvision
Can any of the company-specific risk be diversified away by investing in both Vishay Precision and Microvision 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 Microvision 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 Microvision, you can compare the effects of market volatilities on Vishay Precision and Microvision 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 Microvision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vishay Precision and Microvision.
Diversification Opportunities for Vishay Precision and Microvision
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Vishay and Microvision is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Vishay Precision Group and Microvision in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microvision 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 Microvision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microvision has no effect on the direction of Vishay Precision i.e., Vishay Precision and Microvision go up and down completely randomly.
Pair Corralation between Vishay Precision and Microvision
Considering the 90-day investment horizon Vishay Precision Group is expected to under-perform the Microvision. But the stock apears to be less risky and, when comparing its historical volatility, Vishay Precision Group is 2.53 times less risky than Microvision. The stock trades about -0.04 of its potential returns per unit of risk. The Microvision is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 227.00 in Microvision on September 13, 2024 and sell it today you would lose (139.00) from holding Microvision or give up 61.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vishay Precision Group vs. Microvision
Performance |
| Timeline |
| Vishay Precision |
| Microvision |
Vishay Precision and Microvision Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vishay Precision and Microvision
The main advantage of trading using opposite Vishay Precision and Microvision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vishay Precision position performs unexpectedly, Microvision 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 Microvision will offset losses from the drop in Microvision's long position.| Vishay Precision vs. Mesa Laboratories | Vishay Precision vs. Itron Inc | Vishay Precision vs. Fortive Corp | Vishay Precision vs. ESCO Technologies |
| Microvision vs. Mesa Laboratories | Microvision vs. Itron Inc | Microvision vs. Fortive Corp | Microvision vs. Vishay Precision 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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