Correlation Between 3D Systems and Frequency Electronics

Can any of the company-specific risk be diversified away by investing in both 3D Systems and Frequency Electronics 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 3D Systems and Frequency Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 3D Systems and Frequency Electronics, you can compare the effects of market volatilities on 3D Systems and Frequency Electronics 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 3D Systems with a short position of Frequency Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of 3D Systems and Frequency Electronics.

Diversification Opportunities for 3D Systems and Frequency Electronics

0.8

Correlation Coefficient

3D Systems  Frequency Electronics

Very poor diversification

The 3 months correlation between DDD and Frequency is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding 3D Systems and Frequency Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frequency Electronics and 3D 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 3D Systems are associated (or correlated) with Frequency Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frequency Electronics has no effect on the direction of 3D Systems i.e., 3D Systems and Frequency Electronics go up and down completely randomly.

Pair Corralation between 3D Systems and Frequency Electronics

Considering the 90-day investment horizon 3D Systems is expected to generate 1.08 times more return on investment than Frequency Electronics. However, 3D Systems is 1.08 times more volatile than Frequency Electronics. It trades about 0.03 of its potential returns per unit of risk. Frequency Electronics is currently generating about 0.01 per unit of risk. If you would invest  217.00  in 3D Systems on September 6, 2025 and sell it today you would lose (1.00) from holding 3D Systems or give up 0.46% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

3D Systems  vs.  Frequency Electronics

3D Systems

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in 3D Systems are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile fundamental indicators, 3D Systems may actually be approaching a critical reversion point that can send shares even higher in January 2026.

Frequency Electronics

Risk-Adjusted Performance

Weakest

Compared to the overall equity markets, risk-adjusted returns on investments in Frequency Electronics are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward indicators, Frequency Electronics is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with 3D Systems and Frequency Electronics

The main advantage of trading using opposite 3D Systems and Frequency Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 3D Systems position performs unexpectedly, Frequency Electronics 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 Frequency Electronics will offset losses from the drop in Frequency Electronics' long position.

The idea behind 3D Systems and Frequency Electronics pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.