Correlation Between Vishay Intertechnology and Sandisk Corp

Can any of the company-specific risk be diversified away by investing in both Vishay Intertechnology and Sandisk Corp 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 Intertechnology and Sandisk Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Vishay Intertechnology and Sandisk Corp, you can compare the effects of market volatilities on Vishay Intertechnology and Sandisk Corp 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 Intertechnology with a short position of Sandisk Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vishay Intertechnology and Sandisk Corp.

Diversification Opportunities for Vishay Intertechnology and Sandisk Corp

0.74

Correlation Coefficient

Vishay Intertechnology  Sandisk Corp

Poor diversification

The 3 months correlation between Vishay and Sandisk is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Vishay Intertechnology and Sandisk Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sandisk Corp and Vishay Intertechnology 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 Intertechnology are associated (or correlated) with Sandisk Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sandisk Corp has no effect on the direction of Vishay Intertechnology i.e., Vishay Intertechnology and Sandisk Corp go up and down completely randomly.

Pair Corralation between Vishay Intertechnology and Sandisk Corp

Considering the 90-day investment horizon Vishay Intertechnology is expected to generate 1.15 times less return on investment than Sandisk Corp. In addition to that, Vishay Intertechnology is 1.05 times more volatile than Sandisk Corp. It trades about 0.12 of its total potential returns per unit of risk. Sandisk Corp is currently generating about 0.14 per unit of volatility. If you would invest  3,383  in Sandisk Corp on May 6, 2025 and sell it today you would earn a total of  868.00  from holding Sandisk Corp or generate 25.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Vishay Intertechnology  vs.  Sandisk Corp

Vishay Intertechnology

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Vishay Intertechnology are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite fairly unsteady basic indicators, Vishay Intertechnology demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Sandisk Corp

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Sandisk Corp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite quite weak fundamental indicators, Sandisk Corp disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vishay Intertechnology and Sandisk Corp

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

The idea behind Vishay Intertechnology and Sandisk Corp 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.