Correlation Between IMedia Brands and OSI Systems
Can any of the company-specific risk be diversified away by investing in both IMedia Brands and OSI Systems 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 IMedia Brands and OSI Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IMedia Brands and OSI Systems, you can compare the effects of market volatilities on IMedia Brands and OSI Systems 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 IMedia Brands with a short position of OSI Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of IMedia Brands and OSI Systems.
Diversification Opportunities for IMedia Brands and OSI Systems
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between IMedia and OSI is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding IMedia Brands and OSI Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OSI Systems and IMedia Brands 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 IMedia Brands are associated (or correlated) with OSI Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OSI Systems has no effect on the direction of IMedia Brands i.e., IMedia Brands and OSI Systems go up and down completely randomly.
Pair Corralation between IMedia Brands and OSI Systems
Given the investment horizon of 90 days IMedia Brands is expected to under-perform the OSI Systems. In addition to that, IMedia Brands is 6.78 times more volatile than OSI Systems. It trades about -0.11 of its total potential returns per unit of risk. OSI Systems is currently generating about 0.09 per unit of volatility. If you would invest 8,027 in OSI Systems on September 19, 2024 and sell it today you would earn a total of 9,554 from holding OSI Systems or generate 119.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 28.43% |
| Values | Daily Returns |
IMedia Brands vs. OSI Systems
Performance |
| Timeline |
| IMedia Brands |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| OSI Systems |
IMedia Brands and OSI Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IMedia Brands and OSI Systems
The main advantage of trading using opposite IMedia Brands and OSI Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IMedia Brands position performs unexpectedly, OSI Systems 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 OSI Systems will offset losses from the drop in OSI Systems' long position.The idea behind IMedia Brands and OSI Systems 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.| OSI Systems vs. Sanmina | OSI Systems vs. Benchmark Electronics | OSI Systems vs. Methode Electronics | OSI Systems vs. Celestica |
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.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Transaction History View history of all your transactions and understand their impact on performance |