Correlation Between Electromed and OraSure Technologies
Can any of the company-specific risk be diversified away by investing in both Electromed and OraSure Technologies 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 Electromed and OraSure Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electromed and OraSure Technologies, you can compare the effects of market volatilities on Electromed and OraSure Technologies 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 Electromed with a short position of OraSure Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electromed and OraSure Technologies.
Diversification Opportunities for Electromed and OraSure Technologies
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Electromed and OraSure is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Electromed and OraSure Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OraSure Technologies and Electromed 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 Electromed are associated (or correlated) with OraSure Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OraSure Technologies has no effect on the direction of Electromed i.e., Electromed and OraSure Technologies go up and down completely randomly.
Pair Corralation between Electromed and OraSure Technologies
Given the investment horizon of 90 days Electromed is expected to generate 0.98 times more return on investment than OraSure Technologies. However, Electromed is 1.02 times less risky than OraSure Technologies. It trades about -0.01 of its potential returns per unit of risk. OraSure Technologies is currently generating about -0.09 per unit of risk. If you would invest 2,807 in Electromed on September 22, 2024 and sell it today you would lose (34.00) from holding Electromed or give up 1.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Electromed vs. OraSure Technologies
Performance |
| Timeline |
| Electromed |
| OraSure Technologies |
Electromed and OraSure Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electromed and OraSure Technologies
The main advantage of trading using opposite Electromed and OraSure Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electromed position performs unexpectedly, OraSure Technologies 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 OraSure Technologies will offset losses from the drop in OraSure Technologies' long position.| Electromed vs. Neuropace | Electromed vs. Orthopediatrics Corp | Electromed vs. SurModics | Electromed vs. Paragon 28 |
| OraSure Technologies vs. Akoya Biosciences | OraSure Technologies vs. AtriCure | OraSure Technologies vs. ICU Medical | OraSure Technologies vs. Haemonetics |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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