Correlation Between Allient and Stratasys
Can any of the company-specific risk be diversified away by investing in both Allient and Stratasys 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 Allient and Stratasys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allient and Stratasys, you can compare the effects of market volatilities on Allient and Stratasys 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 Allient with a short position of Stratasys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allient and Stratasys.
Diversification Opportunities for Allient and Stratasys
Poor diversification
The 3 months correlation between Allient and Stratasys is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Allient and Stratasys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stratasys and Allient 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 Allient are associated (or correlated) with Stratasys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stratasys has no effect on the direction of Allient i.e., Allient and Stratasys go up and down completely randomly.
Pair Corralation between Allient and Stratasys
Given the investment horizon of 90 days Allient is expected to under-perform the Stratasys. But the stock apears to be less risky and, when comparing its historical volatility, Allient is 1.13 times less risky than Stratasys. The stock trades about -0.01 of its potential returns per unit of risk. The Stratasys is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,256 in Stratasys on August 30, 2024 and sell it today you would lose (301.00) from holding Stratasys or give up 23.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allient vs. Stratasys
Performance |
| Timeline |
| Allient |
| Stratasys |
Allient and Stratasys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allient and Stratasys
The main advantage of trading using opposite Allient and Stratasys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allient position performs unexpectedly, Stratasys 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 Stratasys will offset losses from the drop in Stratasys' long position.| Allient vs. Old Republic International | Allient vs. Cincinnati Financial | Allient vs. Palomar Holdings | Allient vs. Aegean Airlines SA |
| Stratasys vs. Nano Dimension | Stratasys vs. IONQ Inc | Stratasys vs. D Wave Quantum | Stratasys vs. Desktop Metal |
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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