Correlation Between 3D Systems and Markforged Holding
Can any of the company-specific risk be diversified away by investing in both 3D Systems and Markforged Holding 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 3D Systems and Markforged Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 3D Systems and Markforged Holding Corp, you can compare the effects of market volatilities on 3D Systems and Markforged Holding 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 3D Systems with a short position of Markforged Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of 3D Systems and Markforged Holding.
Diversification Opportunities for 3D Systems and Markforged Holding
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DDD and Markforged is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding 3D Systems and Markforged Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Markforged Holding Corp and 3D Systems 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 3D Systems are associated (or correlated) with Markforged Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Markforged Holding Corp has no effect on the direction of 3D Systems i.e., 3D Systems and Markforged Holding go up and down completely randomly.
Pair Corralation between 3D Systems and Markforged Holding
Considering the 90-day investment horizon 3D Systems is expected to generate 3.68 times more return on investment than Markforged Holding. However, 3D Systems is 3.68 times more volatile than Markforged Holding Corp. It trades about 0.06 of its potential returns per unit of risk. Markforged Holding Corp is currently generating about -0.14 per unit of risk. If you would invest 329.00 in 3D Systems on August 28, 2024 and sell it today you would earn a total of 14.00 from holding 3D Systems or generate 4.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
3D Systems vs. Markforged Holding Corp
Performance |
| Timeline |
| 3D Systems |
| Markforged Holding Corp |
3D Systems and Markforged Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 3D Systems and Markforged Holding
The main advantage of trading using opposite 3D Systems and Markforged Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 3D Systems position performs unexpectedly, Markforged Holding 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 Markforged Holding will offset losses from the drop in Markforged Holding's long position.| 3D Systems vs. Desktop Metal | 3D Systems vs. Nano Dimension | 3D Systems vs. Markforged Holding Corp | 3D Systems vs. Stratasys |
| Markforged Holding vs. Stratasys | Markforged Holding vs. Desktop Metal | Markforged Holding vs. 3D Systems | Markforged Holding vs. Nano Dimension |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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