Correlation Between OSI Systems and Benchmark Electronics
Can any of the company-specific risk be diversified away by investing in both OSI Systems and Benchmark 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 OSI Systems and Benchmark Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OSI Systems and Benchmark Electronics, you can compare the effects of market volatilities on OSI Systems and Benchmark 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 OSI Systems with a short position of Benchmark Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of OSI Systems and Benchmark Electronics.
Diversification Opportunities for OSI Systems and Benchmark Electronics
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between OSI and Benchmark is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding OSI Systems and Benchmark Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Benchmark Electronics and OSI 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 OSI Systems are associated (or correlated) with Benchmark Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Benchmark Electronics has no effect on the direction of OSI Systems i.e., OSI Systems and Benchmark Electronics go up and down completely randomly.
Pair Corralation between OSI Systems and Benchmark Electronics
Given the investment horizon of 90 days OSI Systems is expected to generate 1.97 times less return on investment than Benchmark Electronics. In addition to that, OSI Systems is 1.5 times more volatile than Benchmark Electronics. It trades about 0.1 of its total potential returns per unit of risk. Benchmark Electronics is currently generating about 0.29 per unit of volatility. If you would invest 3,697 in Benchmark Electronics on April 5, 2025 and sell it today you would earn a total of 305.00 from holding Benchmark Electronics or generate 8.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
OSI Systems vs. Benchmark Electronics
Performance |
| Timeline |
| OSI Systems |
| Benchmark Electronics |
OSI Systems and Benchmark Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OSI Systems and Benchmark Electronics
The main advantage of trading using opposite OSI Systems and Benchmark Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OSI Systems position performs unexpectedly, Benchmark 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 Benchmark Electronics will offset losses from the drop in Benchmark Electronics' long position.| OSI Systems vs. The Joint Corp | OSI Systems vs. Transocean | OSI Systems vs. SD Standard Drilling | OSI Systems vs. Major Drilling Group |
| Benchmark Electronics vs. Getty Copper | Benchmark Electronics vs. Zijin Mining Group | Benchmark Electronics vs. Carlyle Group | Benchmark Electronics vs. Ameriprise Financial |
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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