Correlation Between VirTra and Thales SA
Can any of the company-specific risk be diversified away by investing in both VirTra and Thales SA 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 VirTra and Thales SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VirTra Inc and Thales SA ADR, you can compare the effects of market volatilities on VirTra and Thales SA 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 VirTra with a short position of Thales SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of VirTra and Thales SA.
Diversification Opportunities for VirTra and Thales SA
Very good diversification
The 3 months correlation between VirTra and Thales is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding VirTra Inc and Thales SA ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thales SA ADR and VirTra 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 VirTra Inc are associated (or correlated) with Thales SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thales SA ADR has no effect on the direction of VirTra i.e., VirTra and Thales SA go up and down completely randomly.
Pair Corralation between VirTra and Thales SA
If you would invest 749.00 in VirTra Inc on September 12, 2024 and sell it today you would lose (24.00) from holding VirTra Inc or give up 3.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VirTra Inc vs. Thales SA ADR
Performance |
| Timeline |
| VirTra Inc |
| Thales SA ADR |
VirTra and Thales SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VirTra and Thales SA
The main advantage of trading using opposite VirTra and Thales SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VirTra position performs unexpectedly, Thales SA 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 Thales SA will offset losses from the drop in Thales SA's long position.| VirTra vs. Innovative Solutions and | VirTra vs. Park Electrochemical | VirTra vs. Ducommun Incorporated | VirTra vs. National Presto Industries |
| Thales SA vs. Rolls Royce Holdings PLC | Thales SA vs. VirTra Inc | Thales SA vs. BWX Technologies | Thales SA vs. Embraer SA ADR |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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