Correlation Between Vislink Technologies and Hennessy Technology

Can any of the company-specific risk be diversified away by investing in both Vislink Technologies and Hennessy Technology 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 Vislink Technologies and Hennessy Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Vislink Technologies and Hennessy Technology Fund, you can compare the effects of market volatilities on Vislink Technologies and Hennessy Technology 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 Vislink Technologies with a short position of Hennessy Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vislink Technologies and Hennessy Technology.

Diversification Opportunities for Vislink Technologies and Hennessy Technology

-0.52

Correlation Coefficient

Vislink Technologies  Hennessy Technology

Excellent diversification

The 3 months correlation between Vislink and Hennessy is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Vislink Technologies and Hennessy Technology Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hennessy Technology and Vislink Technologies 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 Vislink Technologies are associated (or correlated) with Hennessy Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hennessy Technology has no effect on the direction of Vislink Technologies i.e., Vislink Technologies and Hennessy Technology go up and down completely randomly.

Pair Corralation between Vislink Technologies and Hennessy Technology

Given the investment horizon of 90 days Vislink Technologies is expected to under-perform the Hennessy Technology. In addition to that, Vislink Technologies is 3.54 times more volatile than Hennessy Technology Fund. It trades about -0.01 of its total potential returns per unit of risk. Hennessy Technology Fund is currently generating about 0.06 per unit of volatility. If you would invest  1,783  in Hennessy Technology Fund on May 1, 2025 and sell it today you would earn a total of  776.00  from holding Hennessy Technology Fund or generate 43.52% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	78.14%
Values	Daily Returns

Vislink Technologies  vs.  Hennessy Technology Fund

Vislink Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Vislink Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Vislink Technologies is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Hennessy Technology

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Hennessy Technology Fund are ranked lower than 19 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Hennessy Technology showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vislink Technologies and Hennessy Technology

The main advantage of trading using opposite Vislink Technologies and Hennessy Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vislink Technologies position performs unexpectedly, Hennessy Technology 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 Hennessy Technology will offset losses from the drop in Hennessy Technology's long position.

The idea behind Vislink Technologies and Hennessy Technology Fund 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.

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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.