Correlation Between OSI Systems and Eshallgo
Can any of the company-specific risk be diversified away by investing in both OSI Systems and Eshallgo 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 Eshallgo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OSI Systems and Eshallgo Class A, you can compare the effects of market volatilities on OSI Systems and Eshallgo 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 Eshallgo. Check out your portfolio center. Please also check ongoing floating volatility patterns of OSI Systems and Eshallgo.
Diversification Opportunities for OSI Systems and Eshallgo
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between OSI and Eshallgo is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding OSI Systems and Eshallgo Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eshallgo Class A 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 Eshallgo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eshallgo Class A has no effect on the direction of OSI Systems i.e., OSI Systems and Eshallgo go up and down completely randomly.
Pair Corralation between OSI Systems and Eshallgo
Given the investment horizon of 90 days OSI Systems is expected to generate 0.17 times more return on investment than Eshallgo. However, OSI Systems is 5.73 times less risky than Eshallgo. It trades about -0.53 of its potential returns per unit of risk. Eshallgo Class A is currently generating about -0.1 per unit of risk. If you would invest 18,179 in OSI Systems on October 14, 2024 and sell it today you would lose (2,844) from holding OSI Systems or give up 15.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
OSI Systems vs. Eshallgo Class A
Performance |
| Timeline |
| OSI Systems |
| Eshallgo Class A |
OSI Systems and Eshallgo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OSI Systems and Eshallgo
The main advantage of trading using opposite OSI Systems and Eshallgo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OSI Systems position performs unexpectedly, Eshallgo 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 Eshallgo will offset losses from the drop in Eshallgo's long position.| OSI Systems vs. Sanmina | OSI Systems vs. Benchmark Electronics | OSI Systems vs. Methode Electronics | OSI Systems vs. Celestica |
| Eshallgo vs. Plexus Corp | Eshallgo vs. OSI Systems | Eshallgo vs. CTS Corporation | Eshallgo vs. Benchmark Electronics |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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