Correlation Between Ostin Technology and DecisionPoint Systems

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

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

Diversification Opportunities for Ostin Technology and DecisionPoint Systems

0.28

Correlation Coefficient

Ostin Technology  DecisionPoint Systems

Modest diversification

The 3 months correlation between Ostin and DecisionPoint is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Ostin Technology Group and DecisionPoint Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DecisionPoint Systems and Ostin 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 Ostin Technology Group are associated (or correlated) with DecisionPoint Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DecisionPoint Systems has no effect on the direction of Ostin Technology i.e., Ostin Technology and DecisionPoint Systems go up and down completely randomly.

Pair Corralation between Ostin Technology and DecisionPoint Systems

Considering the 90-day investment horizon Ostin Technology is expected to generate 10.31 times less return on investment than DecisionPoint Systems. In addition to that, Ostin Technology is 2.33 times more volatile than DecisionPoint Systems. It trades about 0.0 of its total potential returns per unit of risk. DecisionPoint Systems is currently generating about 0.06 per unit of volatility. If you would invest  620.00  in DecisionPoint Systems on August 4, 2024 and sell it today you would earn a total of  403.00  from holding DecisionPoint Systems or generate 65.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	78.68%
Values	Daily Returns

Ostin Technology Group  vs.  DecisionPoint Systems

Ostin Technology

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ostin Technology Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Ostin Technology unveiled solid returns over the last few months and may actually be approaching a breakup point.

DecisionPoint Systems

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DecisionPoint Systems has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, DecisionPoint Systems is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Ostin Technology and DecisionPoint Systems

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

The idea behind Ostin Technology Group and DecisionPoint Systems 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.

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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.