Correlation Between OSI Systems and Eltek
Can any of the company-specific risk be diversified away by investing in both OSI Systems and Eltek 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 Eltek into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OSI Systems and Eltek, you can compare the effects of market volatilities on OSI Systems and Eltek 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 Eltek. Check out your portfolio center. Please also check ongoing floating volatility patterns of OSI Systems and Eltek.
Diversification Opportunities for OSI Systems and Eltek
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between OSI and Eltek is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding OSI Systems and Eltek in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eltek 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 Eltek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eltek has no effect on the direction of OSI Systems i.e., OSI Systems and Eltek go up and down completely randomly.
Pair Corralation between OSI Systems and Eltek
Given the investment horizon of 90 days OSI Systems is expected to under-perform the Eltek. In addition to that, OSI Systems is 1.19 times more volatile than Eltek. It trades about -0.12 of its total potential returns per unit of risk. Eltek is currently generating about 0.12 per unit of volatility. If you would invest 1,072 in Eltek on October 24, 2024 and sell it today you would earn a total of 35.00 from holding Eltek or generate 3.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OSI Systems vs. Eltek
Performance |
| Timeline |
| OSI Systems |
| Eltek |
OSI Systems and Eltek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OSI Systems and Eltek
The main advantage of trading using opposite OSI Systems and Eltek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OSI Systems position performs unexpectedly, Eltek 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 Eltek will offset losses from the drop in Eltek's long position.| OSI Systems vs. Sanmina | OSI Systems vs. Benchmark Electronics | OSI Systems vs. Methode Electronics | OSI Systems vs. Celestica |
| Eltek vs. Methode Electronics | Eltek vs. OSI Systems | Eltek vs. Bel Fuse A | Eltek vs. Richardson 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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