Correlation Between Sharps Technology and Olympus
Can any of the company-specific risk be diversified away by investing in both Sharps Technology and Olympus 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 Sharps Technology and Olympus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sharps Technology and Olympus, you can compare the effects of market volatilities on Sharps Technology and Olympus 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 Sharps Technology with a short position of Olympus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sharps Technology and Olympus.
Diversification Opportunities for Sharps Technology and Olympus
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sharps and Olympus is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Sharps Technology and Olympus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Olympus and Sharps Technology 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 Sharps Technology are associated (or correlated) with Olympus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Olympus has no effect on the direction of Sharps Technology i.e., Sharps Technology and Olympus go up and down completely randomly.
Pair Corralation between Sharps Technology and Olympus
Given the investment horizon of 90 days Sharps Technology is expected to under-perform the Olympus. In addition to that, Sharps Technology is 21.24 times more volatile than Olympus. It trades about -0.08 of its total potential returns per unit of risk. Olympus is currently generating about -0.38 per unit of volatility. If you would invest 1,624 in Olympus on September 14, 2024 and sell it today you would lose (61.00) from holding Olympus or give up 3.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Sharps Technology vs. Olympus
Performance |
| Timeline |
| Sharps Technology |
| Olympus |
Sharps Technology and Olympus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sharps Technology and Olympus
The main advantage of trading using opposite Sharps Technology and Olympus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sharps Technology position performs unexpectedly, Olympus 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 Olympus will offset losses from the drop in Olympus' long position.| Sharps Technology vs. JIN MEDICAL INTERNATIONAL | Sharps Technology vs. Meihua International Medical | Sharps Technology vs. GlucoTrack | Sharps Technology vs. Innovative Eyewear |
| Olympus vs. GlucoTrack | Olympus vs. Sharps Technology | Olympus vs. Utah Medical Products | Olympus vs. Innovative Eyewear |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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