Correlation Between Haemonetics and OraSure Technologies
Can any of the company-specific risk be diversified away by investing in both Haemonetics 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 Haemonetics and OraSure Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Haemonetics and OraSure Technologies, you can compare the effects of market volatilities on Haemonetics 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 Haemonetics with a short position of OraSure Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haemonetics and OraSure Technologies.
Diversification Opportunities for Haemonetics and OraSure Technologies
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Haemonetics and OraSure is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Haemonetics and OraSure Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OraSure Technologies and Haemonetics 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 Haemonetics 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 Haemonetics i.e., Haemonetics and OraSure Technologies go up and down completely randomly.
Pair Corralation between Haemonetics and OraSure Technologies
Considering the 90-day investment horizon Haemonetics is expected to under-perform the OraSure Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Haemonetics is 1.51 times less risky than OraSure Technologies. The stock trades about -0.32 of its potential returns per unit of risk. The OraSure Technologies is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 385.00 in OraSure Technologies on September 22, 2024 and sell it today you would lose (21.00) from holding OraSure Technologies or give up 5.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haemonetics vs. OraSure Technologies
Performance |
| Timeline |
| Haemonetics |
| OraSure Technologies |
Haemonetics and OraSure Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haemonetics and OraSure Technologies
The main advantage of trading using opposite Haemonetics and OraSure Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haemonetics 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.The idea behind Haemonetics and OraSure Technologies 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.| 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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