Correlation Between Stratasys and Pure Storage
Can any of the company-specific risk be diversified away by investing in both Stratasys and Pure Storage 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 Stratasys and Pure Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stratasys and Pure Storage, you can compare the effects of market volatilities on Stratasys and Pure Storage 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 Stratasys with a short position of Pure Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stratasys and Pure Storage.
Diversification Opportunities for Stratasys and Pure Storage
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Stratasys and Pure is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Stratasys and Pure Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pure Storage and Stratasys 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 Stratasys are associated (or correlated) with Pure Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pure Storage has no effect on the direction of Stratasys i.e., Stratasys and Pure Storage go up and down completely randomly.
Pair Corralation between Stratasys and Pure Storage
Given the investment horizon of 90 days Stratasys is expected to generate 1.88 times more return on investment than Pure Storage. However, Stratasys is 1.88 times more volatile than Pure Storage. It trades about 0.27 of its potential returns per unit of risk. Pure Storage is currently generating about 0.05 per unit of risk. If you would invest 898.00 in Stratasys on November 18, 2024 and sell it today you would earn a total of 301.00 from holding Stratasys or generate 33.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stratasys vs. Pure Storage
Performance |
| Timeline |
| Stratasys |
| Pure Storage |
Stratasys and Pure Storage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stratasys and Pure Storage
The main advantage of trading using opposite Stratasys and Pure Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stratasys position performs unexpectedly, Pure Storage 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 Pure Storage will offset losses from the drop in Pure Storage's long position.| Stratasys vs. Nano Dimension | Stratasys vs. IONQ Inc | Stratasys vs. D Wave Quantum | Stratasys vs. Desktop Metal |
| Pure Storage vs. Seagate Technology PLC | Pure Storage vs. HP Inc | Pure Storage vs. Dell Technologies | Pure Storage vs. Western Digital |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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