Correlation Between Veeco Instrument and One Choice

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Can any of the company-specific risk be diversified away by investing in both Veeco Instrument and One Choice 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 Veeco Instrument and One Choice into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Veeco Instrument and One Choice Blend, you can compare the effects of market volatilities on Veeco Instrument and One Choice 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 Veeco Instrument with a short position of One Choice. Check out your portfolio center. Please also check ongoing floating volatility patterns of Veeco Instrument and One Choice.

Diversification Opportunities for Veeco Instrument and One Choice

0.92
  Correlation Coefficient

Almost no diversification

The 3 months correlation between Veeco and AAAFX is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Veeco Instrument and One Choice Blend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on One Choice Blend and Veeco Instrument 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 Veeco Instrument are associated (or correlated) with One Choice. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of One Choice Blend has no effect on the direction of Veeco Instrument i.e., Veeco Instrument and One Choice go up and down completely randomly.

Pair Corralation between Veeco Instrument and One Choice

Given the investment horizon of 90 days Veeco Instrument is expected to under-perform the One Choice. In addition to that, Veeco Instrument is 3.05 times more volatile than One Choice Blend. It trades about -0.12 of its total potential returns per unit of risk. One Choice Blend is currently generating about -0.2 per unit of volatility. If you would invest  943.00  in One Choice Blend on March 30, 2022 and sell it today you would lose (33.00)  from holding One Choice Blend or give up 3.5% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy95.0%
ValuesDaily Returns

Veeco Instrument  vs.  One Choice Blend

 Performance (%) 
      Timeline 
Veeco Instrument 
Veeco Performance
0 of 100
Over the last 90 days Veeco Instrument has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental indicators remain quite persistent which may send shares a bit higher in July 2022. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Veeco Price Channel

One Choice Blend 
AAAFX Performance
0 of 100
Over the last 90 days One Choice Blend has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest unsteady performance, the Fund's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

AAAFX Price Channel

Veeco Instrument and One Choice Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Veeco Instrument and One Choice

The main advantage of trading using opposite Veeco Instrument and One Choice positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Veeco Instrument position performs unexpectedly, One Choice 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 One Choice will offset losses from the drop in One Choice's long position.
The idea behind Veeco Instrument and One Choice Blend pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

One Choice Blend

Pair trading matchups for One Choice

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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.

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