Correlation Between OSI Systems and Desktop Metal
Can any of the company-specific risk be diversified away by investing in both OSI Systems and Desktop Metal 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 OSI Systems and Desktop Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OSI Systems and Desktop Metal, you can compare the effects of market volatilities on OSI Systems and Desktop Metal 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 OSI Systems with a short position of Desktop Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of OSI Systems and Desktop Metal.
Diversification Opportunities for OSI Systems and Desktop Metal
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between OSI and Desktop is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding OSI Systems and Desktop Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Desktop Metal and OSI 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 OSI Systems are associated (or correlated) with Desktop Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Desktop Metal has no effect on the direction of OSI Systems i.e., OSI Systems and Desktop Metal go up and down completely randomly.
Pair Corralation between OSI Systems and Desktop Metal
Given the investment horizon of 90 days OSI Systems is expected to generate 0.26 times more return on investment than Desktop Metal. However, OSI Systems is 3.82 times less risky than Desktop Metal. It trades about 0.76 of its potential returns per unit of risk. Desktop Metal is currently generating about -0.07 per unit of risk. If you would invest 15,315 in OSI Systems on September 13, 2024 and sell it today you would earn a total of 3,384 from holding OSI Systems or generate 22.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
OSI Systems vs. Desktop Metal
Performance |
| Timeline |
| OSI Systems |
| Desktop Metal |
OSI Systems and Desktop Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OSI Systems and Desktop Metal
The main advantage of trading using opposite OSI Systems and Desktop Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OSI Systems position performs unexpectedly, Desktop Metal 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 Desktop Metal will offset losses from the drop in Desktop Metal's long position.| OSI Systems vs. Sanmina | OSI Systems vs. Benchmark Electronics | OSI Systems vs. Methode Electronics | OSI Systems vs. Celestica |
| Desktop Metal vs. Quantum Computing | Desktop Metal vs. IONQ Inc | Desktop Metal vs. Quantum | Desktop Metal vs. Super Micro Computer |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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