Correlation Between Ouster and Bel Fuse
Can any of the company-specific risk be diversified away by investing in both Ouster and Bel Fuse 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 Ouster and Bel Fuse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ouster Inc and Bel Fuse A, you can compare the effects of market volatilities on Ouster and Bel Fuse 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 Ouster with a short position of Bel Fuse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ouster and Bel Fuse.
Diversification Opportunities for Ouster and Bel Fuse
Average diversification
The 3 months correlation between Ouster and Bel is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Ouster Inc and Bel Fuse A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bel Fuse A and Ouster 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 Ouster Inc are associated (or correlated) with Bel Fuse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bel Fuse A has no effect on the direction of Ouster i.e., Ouster and Bel Fuse go up and down completely randomly.
Pair Corralation between Ouster and Bel Fuse
Given the investment horizon of 90 days Ouster is expected to generate 3.68 times less return on investment than Bel Fuse. In addition to that, Ouster is 2.32 times more volatile than Bel Fuse A. It trades about 0.01 of its total potential returns per unit of risk. Bel Fuse A is currently generating about 0.06 per unit of volatility. If you would invest 8,446 in Bel Fuse A on September 1, 2024 and sell it today you would earn a total of 1,220 from holding Bel Fuse A or generate 14.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ouster Inc vs. Bel Fuse A
Performance |
| Timeline |
| Ouster Inc |
| Bel Fuse A |
Ouster and Bel Fuse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ouster and Bel Fuse
The main advantage of trading using opposite Ouster and Bel Fuse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ouster position performs unexpectedly, Bel Fuse 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 Bel Fuse will offset losses from the drop in Bel Fuse's long position.| Ouster vs. KULR Technology Group | Ouster vs. LightPath Technologies | Ouster vs. Daktronics | Ouster vs. Kopin |
| Bel Fuse vs. Richardson Electronics | Bel Fuse vs. LSI Industries | Bel Fuse vs. Benchmark Electronics | Bel Fuse vs. Plexus Corp |
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 Stocks Directory module to find actively traded stocks across global markets.
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