Correlation Between Wabash National and Vishay Intertechnology
Can any of the company-specific risk be diversified away by investing in both Wabash National and Vishay Intertechnology 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 Wabash National and Vishay Intertechnology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wabash National and Vishay Intertechnology, you can compare the effects of market volatilities on Wabash National and Vishay Intertechnology 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 Wabash National with a short position of Vishay Intertechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wabash National and Vishay Intertechnology.
Diversification Opportunities for Wabash National and Vishay Intertechnology
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Wabash and Vishay is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Wabash National and Vishay Intertechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vishay Intertechnology and Wabash National 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 Wabash National are associated (or correlated) with Vishay Intertechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vishay Intertechnology has no effect on the direction of Wabash National i.e., Wabash National and Vishay Intertechnology go up and down completely randomly.
Pair Corralation between Wabash National and Vishay Intertechnology
Considering the 90-day investment horizon Wabash National is expected to generate 1.19 times more return on investment than Vishay Intertechnology. However, Wabash National is 1.19 times more volatile than Vishay Intertechnology. It trades about -0.02 of its potential returns per unit of risk. Vishay Intertechnology is currently generating about -0.04 per unit of risk. If you would invest 2,364 in Wabash National on September 19, 2024 and sell it today you would lose (537.00) from holding Wabash National or give up 22.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wabash National vs. Vishay Intertechnology
Performance |
| Timeline |
| Wabash National |
| Vishay Intertechnology |
Wabash National and Vishay Intertechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wabash National and Vishay Intertechnology
The main advantage of trading using opposite Wabash National and Vishay Intertechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wabash National position performs unexpectedly, Vishay Intertechnology 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 Intertechnology will offset losses from the drop in Vishay Intertechnology's long position.| Wabash National vs. Aquagold International | Wabash National vs. Thrivent High Yield | Wabash National vs. Morningstar Unconstrained Allocation | Wabash National vs. Via Renewables |
| Vishay Intertechnology vs. IONQ Inc | Vishay Intertechnology vs. Quantum | Vishay Intertechnology vs. Super Micro Computer | Vishay Intertechnology vs. Red Cat Holdings |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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