Correlation Between Medical Facilities and Osisko Metals

Can any of the company-specific risk be diversified away by investing in both Medical Facilities and Osisko Metals 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 Medical Facilities and Osisko Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Medical Facilities and Osisko Metals, you can compare the effects of market volatilities on Medical Facilities and Osisko Metals 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 Medical Facilities with a short position of Osisko Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medical Facilities and Osisko Metals.

Diversification Opportunities for Medical Facilities and Osisko Metals

0.2

Correlation Coefficient

Medical Facilities  Osisko Metals

Modest diversification

The 3 months correlation between Medical and Osisko is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Medical Facilities and Osisko Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Osisko Metals and Medical Facilities 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 Medical Facilities are associated (or correlated) with Osisko Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Osisko Metals has no effect on the direction of Medical Facilities i.e., Medical Facilities and Osisko Metals go up and down completely randomly.

Pair Corralation between Medical Facilities and Osisko Metals

Assuming the 90 days horizon Medical Facilities is expected to generate 13.68 times less return on investment than Osisko Metals. But when comparing it to its historical volatility, Medical Facilities is 2.87 times less risky than Osisko Metals. It trades about 0.02 of its potential returns per unit of risk. Osisko Metals is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  17.00  in Osisko Metals on May 6, 2025 and sell it today you would earn a total of  24.00  from holding Osisko Metals or generate 141.18% return on investment over 90 days.

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

Medical Facilities  vs.  Osisko Metals

Medical Facilities

Risk-Adjusted Performance

Very Weak

Over the last 90 days Medical Facilities has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Medical Facilities is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Osisko Metals

Risk-Adjusted Performance

Very Weak

Over the last 90 days Osisko Metals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Osisko Metals is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Medical Facilities and Osisko Metals

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

The idea behind Medical Facilities and Osisko Metals 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.